secrecy around it. From the limited primary data gathering able to be done in the preparation of this report there is no
A Stocktake of New Zealand’s Housing — F E B RUA RY 2018 —
Alan Johnson Philippa Howden-Chapman Shamubeel Eaqub
A Stocktake of New Zealand’s Housing – February 2018
ACKNOWLEDGEMENTS The authors would like to thank the many analysts in the Ministry of Business, Innovation and Employment, Ministry of Social Development, Statistics NZ, Ministry of Health, Housing NZ, Treasury, Te Puni Kōkiri, emergency housing providers and researchers in He Kainga Oranga/ Housing and Health Research Programme, University of Otago, Wellington for the data they have provided.
Disclaimer The views, opinions, findings, and conclusions expressed by the authors – Alan Johnson, Philippa Howden-Chapman and Shamubeel Eaqub – in this report do not necessarily reflect the views of the NZ Government, the Ministry of Business, Innovation and Employment (MBIE) or any other government agency. MBIE has made every effort to ensure that the information contained in this report is reliable, but does not guarantee its accuracy or completeness and does not accept any liability for any errors. Crown Copyright © 2018 Unless otherwise indicated, this work is protected by copyright owned by the Crown. This work is licensed for re-use under a Creative Commons Attribution 4.0 International Licence. In essence, you are free to copy, distribute and adapt the material, as long as you attribute the work to the Crown and abide by other licence terms. To view a copy of this licence, visit https://creativecommons.org/licenses/by/4.0/. Please note that no departmental or governmental emblem, logo or Coat of Arms may be used in any way which infringes any provision of the Flags, Emblems, and Names Protection Act 1981. Attribution to the Crown should be in written format and not by reproduction of any such emblem, logo or Coat of Arms.
Copyright in the photographs used in this publication is not owned or licensed to you by the Crown. You cannot copy, distribute or adapt any photograph without the agreement of the copyright owner. ISBN 978-1-98-853554-8 (online)
A Stocktake of New Zealand’s Housing – February 2018
TABLE OF CONTENTS FOREWORD – HOUSING STOCKTAKE
2
INTRODUCTION
3
1. MARKET RENTING
7
2. HOME OWNERSHIP
13
3. NEW HOUSING
19
4. STATE AND OTHER SOCIAL HOUSING
26
5. HOUSING ASSISTANCE
31
6. HOMELESSNESS AND EMERGENCY HOUSING
35
7. SECURITY OF TENURE
38
8. THE SOCIAL COSTS AND BENEFITS OF HOUSING QUALITY
42
REFERENCES
47
APPENDICES
53
1
A Stocktake of New Zealand’s Housing – February 2018
Foreword – Housing Stocktake
There was a time, in the not-so distant past, when housing was affordable and buying a house to raise your family was not the unobtainable dream it is today. With homeownership now at a 60-year low and families forced to live in overcrowded houses, it is clear New Zealand’s housing system is failing too many people. That an unknown number of children are living in cars and thousands more are admitted to hospital every year with preventable illnesses caused by poor housing, is nothing short of a tragedy. This Government is committed to fixing New Zealand’s housing crisis. But to understand how to fix the crisis, we must first understand the extent of the problems. This requires a “warts and all” look at the entire housing continuum from homelessness, to the rising demand for state houses, through to the state of the real estate market. For this reason, the Government commissioned independent experts Alan Johnson, Philippa Howden-Chapman and Shamubeel Eaqub to report on the state of housing in New Zealand. This report is an important building block that will help the Government make policy decisions. It assesses the key parts of our housing system; examining market renting, homeownership, new housing, state and social housing, housing assistance, homelessness and emergency housing, security of tenure and the social costs and benefits of housing quality. We must acknowledge the harsh effects the housing crisis has had on Māori. They have borne the brunt of rapidly rising house prices and skyrocketing rents. A crucial part of Government policy must help more Māori into their own homes, and there are great opportunities to partner with Māori organisations to do this. All New Zealanders deserve to have a secure and healthy home. That is the foundation which allows us all to build happy and successful lives. It is time to take bold action to stop the stress and disruption the housing crisis is causing our people, and especially our kids.
HON PHIL TWYFORD Minister of Housing and Urban Development February 2018
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A Stocktake of New Zealand’s Housing – February 2018
Introduction
This stocktake report was commissioned by the Minister of Housing and Urban Development the Hon Phil Twyford in November 2017. Its main purpose is to provide the New Zealand public with a broad overview of the current state of housing markets and the housing system in New Zealand. This overview takes the form of a series of brief reviews of various housing outcomes and policy areas and backs these with extensive data and additional references. The brevity of this overview alongside the complexity of the topics it grapples with means that this stocktake is high level and intentionally so. Such a perspective has allowed the authors to identify the key issues facing New Zealand in the housing and social policy spaces. However, although the project brief was to produce a report which is quite descriptive and avoids commenting on policy, this direction has proved difficult to follow completely. This is in part because many of the outcomes identified here are a consequence of policy – the high levels of children’s hospitalisations as a result of poor quality housing is one such example. The approach taken here is to limit commentary on policy to just the identification of areas where either additional work should be done or where a re-focus might be useful. Based on this approach the following is offered as a summary of this stocktake.
Response to homelessness inadequate In mid-2016 the previous National Government began to appreciate the extent of the growing shortage in affordable good quality rental housing and commenced an emergency housing programme with some urgency. This programme has expanded the number of places available for families without secure housing from 643 in September 2016 to 1,663 in September 2017 with a target of 2,155 places by the end of 2017 1 and introduced the Emergency Housing Special Needs Grant (EHSNG). Over the same period the numbers of households categorised as Priority A on the social housing waiting list and living in insecure housing almost doubled from 1,139 to 2,168. Evidence on the size and trends in homelessness is always difficult to gather on account of the diverse nature of the problem and the difficulty in measuring it because of privacy and often secrecy around it. From the limited primary data gathering able to be done in the preparation of this report there is no evidence available to suggest that the homelessness problem – in its many guises – is easing, but it may be stabilising. The suggestion by Ministry of Business Innovation and Employment (MBIE) in its briefing to the Minister of Housing and Urban Development that Auckland’s housing shortage has reached almost 45,000 units and grew by about 8,000 in the past year suggests that the most recent response may still not be adequate.
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A Stocktake of New Zealand’s Housing – February 2018
A problem in the main centres Home ownership rates have fallen to the lowest levels in 60 years. House price inflation over the past five years has been around 30% across New Zealand overall while incomes have risen by about half this rate. There is however significant regional variance around this average national rate with house prices rising by approximately 65% in Auckland and 45% in Waikato. These increases have had two sorts of impacts. For first-home buyers they present obvious barriers to entering the market which have been added to with lower loan-to-value ratios being required as a result of the Reserve Bank’s policies primarily to promote financial sector stability. On the positive side are historically low interest rates, which have made housing costs for all indebted owner-occupiers lower. The second but somewhat indirect impact is on rents. High house prices have subdued yields on rental property investment and are likely to have also limited new supply of rental housing, which in turn has caused rents to rise faster than incomes. This trend is noticeable since 2015. Housing affordability is not a growing problem for established homeowners and for tenants living in regions with little or no population growth.2 It is however a problem for first-home buyers and for tenants in the main cities, the towns and communities around these and resort towns. Current settings around housing assistance programmes, like the Accommodation Supplement, are doing little to relieve these affordability problems.
Lack of housing supply exacerbated by infrastructure funding constraints Underlying these affordability problems is an inadequate supply of new housing. While current levels of building consents and house construction are at decade highs, these levels are not exceptional over a longer history and have certainly not been adequate for the strong population growth experienced over the past five years. This population growth has been fuelled by a large increase in net migration that has had a particular impact on Auckland, which is growing at the rate of 40,000 people per year. The current shortfall of housing in Auckland is estimated to be at around 28,000 dwellings over the past decade, although other estimates put this deficit at 45,000 units. Constraints around planning and resource and building consents have been blamed for this shortfall and there is probably some justification for this. However, bigger existing and future constraints are around the funding and provision of urban infrastructure to support new house building and it is by no means clear the local Councils and their ratepayers can continue to borrow to fund these assets.
Private rental housing growing and under stress About half of New Zealand adults owned their home in 2013. The private rental housing market appears to be under considerable supply side pressure on account of high house construction costs, high house prices and low yields. Over 70% of the additional 150,000 households formed over the past decade are likely to have become tenants and recent strong population growth has consolidated this strong demand for private rental accommodation. Signs of stress within this market include rents beginning to rise faster than wages and salaries – perhaps twice as fast in some places – and declining turnover of tenancies as people remain in the housing they have. Rising levels of homelessness and continuing rates of housing related poverty are also further evidence of this stress. Regrettably, there are no short-term fixes to these problems.
4
A Stocktake of New Zealand’s Housing – February 2018
Housing insecurity increases for Māori and Pacific peoples Recent housing policies have failed to address the housing problems of Māori and Pacific peoples. Rising housing costs have contributed to declining home ownership rates, greater housing instability, and Māori and Pacific peoples living in poor quality housing. By 2013, Māori and Pacific homeownership rates had declined relatively rapidly to 28% for Māori and 19% for Pacific peoples, compared with 57% for Europeans. Māori landowners have a range of spiritual, cultural and economic aspirations for their whenua including housing. Despite the apparent availability of land owned by Māori, there are challenges related to achieving the right to build on multiply owned land, the provision of infrastructure, access to finance, and central and local planning rules.3,4 Reductions in the number of state houses have led to major shifts in tenure patterns for those on low incomes. In the renting population, between 1986 and 2013, the proportion of Māori renting state housing dropped by 29 percentage points compared to 16 points overall. As state housing has become less available, unaffordable rentals in the private market have become the only option available for many families. Again in the renting population, the proportion renting in the private sector rose rapidly from 1986, but for Māori, the percentage increased from 41% to 77%. In 1986, around half of Māori children lived in an owner-occupied dwelling, but by 2013, the proportion was only 39%.5 These trends are also clear for Pacific peoples. Between 1986 and 2013, the proportion of Pacific peoples renting state housing dropped 27 percentage points and the proportion renting in the private sector increased from 27% to 56%. The proportion of Pacific children who lived in an owner-occupied dwelling dropped from around half in 1986 to 28% in 2013. Private rental tenants generally pay a much higher proportion of their disposable household income on housing than owner-occupiers or social housing tenants. Because rising housing costs are increasingly impoverishing low-income households, one response to these costs is household crowding, which adds to the serious risks of infectious diseases and hospitalisation, and another is increased rates of homelessness. Concerted effective policy action is needed to increase home ownership and rental security for Māori and Pacific households.5
The future of the Accommodation Supplement The previous Government’s decision to increase maximum payments under the Accommodation Supplement (AS) programme was overdue and the present Government’s decision to press ahead with these increases, in April 2018, is sensible under the circumstances of rising rents and increasing levels of housing-related poverty. However, such policy adjustments are unlikely to offer much relief and cannot be seen as a medium-term solution to the clear limitations of the AS as one of the main housing affordability policy instruments. The announced changes will eventually put a further $500 million annually into the AS programme and more than $400 million into private rental housing markets. The extent to which the AS is effectively a tenants’ or landlords’ subsidy is unclear, but will be partly determined by the available rental supply and will be tested by changes in rents during mid-2018 as this increased expenditure feeds through. The supply side pressure in private rental housing markets suggests that much of this increase will be soaked up in even higher rents. If this is the case then the need for a radical review of the AS will become apparent.
5
A Stocktake of New Zealand’s Housing – February 2018
Tenants’ rights need strengthening Private rental housing tends to be of poorer quality and the tenure of such housing is more tenuous than home ownership. In the absence of any regulatory enforcement and as demand has out-stripped supply, there have been few incentives for landlords to maintain or improve the quality of their rental houses, which on average are of poorer quality than owner-occupied homes. The social and economic costs of these poor housing conditions and of insecure tenure are well documented in this paper. Tenant households tend to have higher housing costs relative to their income and to suffer poorer health outcomes. In addition, children from tenant households are more mobile and are at greater risk of not succeeding at school. In the current market there are few incentives for landlords to have fixed-term tenancy agreements longer than 12 months, which precludes rent increases for the duration of the tenancy (unless otherwise agreed). This leaves most tenants with little security of tenure and no effective protection against frequent six-monthly rent increases.6 Private rental housing will feature prominently in our future housing landscape, regardless of what is achieved in building more social housing and in extending home ownership options for first time home buyers. The authors see a fundamental review of tenancy law, which provides greater security of tenure for tenants and encourages professional landlordism, as being an important and overdue social policy challenge.
Older people facing increasing housing-related poverty The falling rates of homeownership over the past 25 years is now feeding through into the housing options for retiring Baby Boomers. The numbers of people receiving both New Zealand Superannuation and an Accommodation Supplement payment is growing by 2,000 per year. While the historic basis for current retirement income policy settings is unclear these were developed in a time where most people retired with debt-free home ownership and when there was adequate provision of social housing to cater for those who had not achieved this. These conditions are long gone and increasing numbers of retired people will need to gain housing in the private rental market. Their limited income – even with the Accommodation Supplement – may make this difficult and there is a growing risk that we will see more and more older people living in housing-related poverty.
6
A Stocktake of New Zealand’s Housing – February 2018
1. Market Renting
Renting can give flexibility, but can also cause instability. While renting is a good option for many, for others, especially those with young children or those who are retired, the lack of control of housing costs and dislocation can have far-reaching consequences discussed later. Though current rental laws do not preclude long-term rentals, the market pattern is commonly a one-year fixed tenancy with an average relatively short term of about two-years. Without a fixed-term tenancy, a landlord is only required to give tenants 90-days’ notice. Renting is becoming less affordable than it was in the 1980s, with a pattern of an increasing number of crowded households and number of people living in them and ongoing state assistance. Growing demand, when there is already an inadequate supply of housing, combined with the sale of public housing, is creating intense pressures. The rental stock is less likely to turn over and tenancies are gradually becoming longer – consistent with a tighter rental market.
1.1 Demand and supply of rental housing In the 2013 Census, only about half New Zealand adults owned their home.7 In official statistics, housing tenure is measured in two main ways – the tenure of the household and the tenure of all New Zealand adults (15+).8 In the 2013 Census, 33% of people in households lived in a rented dwelling. A further 3% lived in a rent-free dwelling. As at 30 September 2017, Stats NZ estimates of households and dwellings by tenure show that the number of dwellings either rented or provided rent-free to occupants grew almost 23% between 2007 and 2017, while the total number of dwellings grew just 11% (see Figure 1.1 and Appendix Table 1). This means that nearly 70% of the additional dwellings were occupied by tenants. In turn, this indicates that the proportion of dwellings tenanted rose from 34% in late 2007 to 37% in late 2017. These estimates assume a continuation of recent trends in household tenure, until definitive results from the 2018 census are available. Quarterly Stats NZ dwelling and household estimates indicate that there are around 581,000 renting households at 31 December 2017. A further 1,735,000 households were ‘owner-occupied’
581,000 of households in New Zealand are renters
7
581k
A Stocktake of New Zealand’s Housing – February 2018
(including those held in a family trust) and another 65,000 households had their dwellings provided free by individuals, private trusts, businesses or government agencies. These figures include a small number of temporary dwellings (10,782 were counted at the 2013 Census, or just under 1% of all privately-occupied dwellings). MBIE estimates, derived from the 2013 Census, are close to Stats NZ’s – 574,000 households renting, mostly from private landlords and in larger households. Yet, there are only 387,000 active bonds in MBIE’s Residential Tenancy Trust Account (RTTA) as requiring, collecting and lodging bonds is at the discretion of landlords. Households that rent from friends or family, or from an employer, are likely to be included in the population that have not lodged a bond. A 2017 BRANZ survey estimated that bonds are lodged in 82% of tenancies.9 There are approximately 400,000 RTTA transactions per year and currently just over $500 million in bonds in the RTTA. The Tenancy Tribunal is funded by the interest from these funds (that is, tenants’ money), yet 90% of the applications to the Tribunal are from landlords, effectively making it a landlords’ tribunal. Bonds that are unclaimed at the end of a tenancy and not collected after six years are transferred to the Government’s Consolidated Fund. Over the five years to 2015, a significant amount ($46 million) was transferred into this fund, which despite the initial intent of the Tribunal makes the tenancy bond effectively a regressive transfer.10 FIGURE 1.1: ESTIMATES OF TENANT HOUSEHOLDS AND RENTED DWELLINGS – 2007 TO 201711
There is considerable disparity in rates of renting by ethnic groups and between regions. Figure 1.2 illustrates tenure patterns by ethnicity taken from Census data since 1986, which shows clearly the higher rates of renting by Māori and Pacific peoples and the increasing rates since 1991, when home-ownership rates peaked – especially for Pacific peoples. These trends are an indication of relatively lower incomes among Māori and Pacific peoples, who are less able to afford a deposit on a home, which, apart from providing social and cultural security, then becomes a major asset, a store of wealth that can be used as an economic buffer. Table 2 in the Appendix reports 2013 Census regional tenure patterns and estimates changes in dwellings since then. Regions with the highest proportions of rental housing are Gisborne (43%) and Auckland (40%), while those with the lowest rates are Tasman (27%) and Marlborough (31%).
8
There is considerable disparity in rates of renting with higher rates experienced by Māori and Pacific peoples
A Stocktake of New Zealand’s Housing – February 2018
FIGURE 1.2: PROPORTION OF PEOPLE IN HOUSEHOLDS THAT DID NOT OWN THEIR DWELLING BY ETHNICITY – 1986 TO 201312 Percentage renting by major ethnic group 80 70
66.9
percentage
60 50
56.9 49.2 46.1
41.6 36.3
40 30 20
27.2
29.9
24.8 21.1
10 0 1986 Pacific Peoples (+36%)
1991
1996 Maori (+23%)
2001 Asian (+53%)
2006 European (+42%)
2013 Total NZ (+46%)
As discussed elsewhere in this paper the rental housing market is heavily reliant on public subsidies for its viability. Of the 687,000 dwellings either rented or provided rent-free around 82,000 are social housing units while a further 190,000 private tenant households received the Accommodation Supplement. In other words, around 40% of the private rental market has some level of state or public support. The numbers of social housing units and subsidised private tenants have changed little over the past decade while the number of households renting in the private sector grew by 126,000 between 2007 and 2017. This means that a dwindling proportion of households are being supported against a background of rising rents. The slow rate of new building relative to population growth has meant that the traditional model of building more expensive new houses for owner-occupiers, with older stock passed down to the rental market, is not working. Current rental yields are too low in most regions to justify building new houses to rent. Rather, capital gains far outstrip rental returns. Many are ‘accidental’ landlords, who are really in the business of owning a home for capital gains, which happens to have tenants. This framing of ‘accidental landlord’ primarily seeking capital gains is to some extent borne out by the evidence of declining yields on investments in residential rental properties. As shown in Figure 1.3 and Appendix Table 3 rental investment yields have fallen gradually from 6% to 7% in 1997 to 3.5% to 5% in 2017. Such rates of return are now below mortgage interest rates and are close to low-risk deposit rates.
190,000 of private tenant houses receive the Accommodation Supplement
9
190k
A Stocktake of New Zealand’s Housing – February 2018
FIGURE 1.3: RENTAL INVESTMENT YIELDS – 1997 TO 201713
1.2 Rents and affordability Data on the affordability of rental housing show a mixed picture depending on the source of the data and its focus. Stats NZ’s Household Economic Survey (HES) reports the proportions of households paying over 25%, 30% and 40% of their incomes on housing and these data suggest that little has changed over the past decade in terms of the percentage of tenant households exceeding these thresholds (see Figure 1.4 and Tables 4 and 5 in the Appendix).14 These data illustrate a number of points, which are probably expected. Tenants’ housing costs relative to incomes for example are higher in Auckland than elsewhere in the country and lowest outside the main cities in both the North and South Islands.15 In addition, tenants generally pay a higher proportion of their household income on housing than do owner-occupiers. Of those households paying over 40% of their income to housing costs, 60% to 65% are tenants, although they make up just 36% of households overall. However, these data present a picture of housing affordability in aggregate and include households in social housing, which receive income-related or discounted rents.
Tenants generally pay a higher proportion of household income on housing than homeowners
FIGURE 1.4: PROPORTIONS OF TENANT HOUSEHOLDS WITH HOUSING COSTS/HOUSEHOLD INCOMES ABOVE VARIOUS THRESHOLDS – 2008 TO 201716
10
A Stocktake of New Zealand’s Housing – February 2018
Data from MBIE’s Tenancy Bond Division provides a picture of current market level rents rather than a snapshot of average rents. Such a current picture allows us to gather an impression of the relationship between rents, incomes and prices overall. Figure 1.5 charts indices of lower quartile rents, average wages and the consumer price index. This shows that rents and wages more or less moved in tandem until late 2014 and that since then rents have risen faster than wages and much faster than prices generally. These data are offered in Table 6 of the Appendix. FIGURE 1.5: INDICES OF LOWER QUARTILE RENTS, WAGES AND CONSUMER PRICES – 2007 TO 201717
This trend of rents rising at a faster rate than wages is also borne out in analysis of mean rents for three-bedroom houses in a selection of modest income suburbs across New Zealand. This analysis in Table 7 in the Appendix shows that between late 2012 and late 2017 average rents for three-bedroom houses rose around 25% while wages rose only about 14%.18 Most recently, rent increases have been greatest in Waikato and Bay of Plenty, while exceptionally they appear to have dropped slightly in Christchurch.
11
A Stocktake of New Zealand’s Housing – February 2018
1.3 Availability of rental housing The rental market is very tight. There has been a downward trend in the number of new bonds, or closed bonds as a proportion of the rental market since 2007 (see Figure 1.6). Both are measures of activity in the rental market. This is consistent with longer tenancies. The trend of falling turnover rates within the private rental housing market is shown in Figure 1.6, which reports the number of new bonds issued every quarter as a proportion of the total active bonds for that quarter (see also data reported for selected regions in Appendix Table 8). There are two implications of this slowing turnover of private rental housing. First, the tenancies in the private rental market are becoming longer. This is potentially good news. But the average tenure of just over two years is still short, when considering the costs of moving a household.19 Second, when people are looking for a rental property, there is little available stock. Limited choice means it can be difficult to find a suitable property in reasonable condition in proximity to schools, transport links and other amenities. FIGURE 1.6: TURNOVER OF PRIVATE RENTAL HOUSING – 2007 TO 201720
1.4 Trapped in a sub-optimal equilibrium The rental market is trapped in a sub-optimal equilibrium. It is characterised by tenancy turnover, which is still relatively high, reducing the incentive and certainty for both tenant and landlord to plan for long-term tenures, with the most common tenancy type being a 12 month, fixed-term tenancy.21 If both had more certainty of long-term tenancies and social norms changed to require higher quality standards, this might provide greater encouragement for both tenants and landlords to take a long-term view on rents and maintenance, which could be reflected in gradual increases at a pre-determined rate or index. Although longer fixed-term tenancies are legally possible, it is difficult to move from one entrenched way of doing things to another. As the diversity and number of households having to rent in the private market increases, policies around rentals, AS and state housing need to work better together.
12
A Stocktake of New Zealand’s Housing – February 2018
2. Home Ownership
The past 25 years have seen the gradual demise of the so-called Kiwi Dream – a place where home ownership and the economic independence which this offers, was within reach of most working families. Home ownership rates have fallen to a 60-year low and could fall further. These falls have been alongside rapid house price inflation in many parts of New Zealand and, with this, deteriorating affordability. We are quickly becoming a society divided by the ownership of housing and its related wealth and recent housing and tax policy settings appear to have exacerbated this division.
Home ownership rates have fallen to a 60-year low
2.1 Declining homeownership Declining rates of home ownership have become a defining feature of New Zealand’s housing landscape since 1991. In 2013, just under 65% of households owned their dwelling, which is the lowest rate of home ownership since 1953. Home ownership rates since 1936 are reported in Figure 2.1. The peaking of ownership rates in 1991 is historically significant since this was the year of Ruth Richardson’s ‘mother of all budgets’ which ended the state’s home-ownership support programmes and commenced the sell-off of the State’s mortgage portfolio. As reported in the housing support section of this stocktake report, current programmes to support homeownership remain relatively insignificant in the context of Government’s overall housing support programmes, although the KiwiSaver HomeStart grant programme is expected to reach $102 million in value in the current (2017/18) financial year,22 compared to $1,218 million in the AS. FIGURE 2.1: HOMEOWNERSHIP RATES FOR HOUSEHOLDS – 1936 TO 201723
13
A Stocktake of New Zealand’s Housing – February 2018
Pacific peoples suffered the greatest decline in home ownership between 1986 and 2013 – a fall of 35%
–35%
Home ownership is of course not evenly distributed through the population, either by age or ethnicity. Since 2001, the census has collected information about individual home-ownership as well as tenure of household. Every New Zealander aged 15 and over is asked whether they own or partly own the dwelling in which they live. These figures include people in non-private dwellings such as student hostels and rest homes. Figure 2.2 reports both levels of individual adult home ownership by ethnicity and changes in these levels between 2001 and 2013. These data show that Europeans/Pākehā have enjoyed higher homeownership rates than other ethnicities; in 2013 this rate was 57% compared with Māori at 28% and Pacific Island peoples at 19%. FIGURE 2.2: INDIVIDUAL HOME OWNERSHIP RATES BY HIGH-LEVEL ETHNIC GROUP – 2001 TO 201324
Table 2.1 shows the percent of people of all ages living in an owned household, so includes children living in their parent’s house. While the percentage of people of all ethnicities living in owned households has declined between 1986 and 2013, Māori households (20%) and Pacific households (35%) have again had greater declines than Europeans.
14
A Stocktake of New Zealand’s Housing – February 2018
TABLE 2.1: PERCENT OF PEOPLE IN HOUSEHOLDS LIVING IN AN OWNED DWELLING FROM 1986 TO 2013, BY ETHNICITY % decline between 1986
1991
1996
2001
2006
2013
1986 and 2013
European
78.9
79.3
75.4
72.8
71.4
70.1
-11.2
Māori
53.9
57.4
52.3
47.0
45.2
43.1
-20.0
Pacific peoples
50.8
49.3
44.4
38.2
36.6
33.1
-34.8
Total population
75.2
75.2
70.9
67.4
66.4
63.7
-15.3
Home ownership rates by age have tended to follow a life cycle process, because historically most people earn more and acquire wealth as they move through working life. Such an experience has given rise to the idea of housing careers – that is that people’s housing options broaden as they get older and move from rental housing into mortgaged home ownership and eventually mortgagefree home ownership. This idea appears to be becoming less widely shared as more and more people are stuck in rental housing for most if not all of their adult lives. This breakdown is shown in Figure 2.3, which reports home ownership rates by age group from the past three censuses. This graph illustrates the structural shift which has occurred within New Zealand society around home ownership and perhaps also around the overall distribution of wealth. Figure 2.3 shows that the chances of an individual owning their home at any given age have fallen over time. For example, in 2001, 69% of 40 to 44 year olds owned their home, but by 2013 this rate amongst 40 to 44 year olds had fallen to 58% (see data in Appendix Table 9). These declining home ownership rates are already affecting those entering retirement and still renting and the numbers of such people will increase over time. This declining trend is of some importance to people in late-middle age who face the prospect of housing-related poverty in their retirement and old age, mainly because our retirement income policies have been promised on high levels of debt-free homeownership amongst the over 65s population. This prospect is a significant and immediate policy challenge and the implications are explored in a following section on housing support programmes. FIGURE 2.3: HOME OWNERSHIP RATES BY AGE – 2001 TO 201325
Home ownership rates on a regional basis from the 2013 Census are reported in Appendix Table 10. These show the lowest rates of home ownership in Gisborne and Auckland and the highest rates in Tasman and Otago regions.
15
A Stocktake of New Zealand’s Housing – February 2018
While there is a long-term trend in declining home-ownership across all age groups there is emerging evidence that first-time home buyers are faring slightly better in the mortgage stakes. This may be due to the assistance offered through the KiwiSaver HomeStart grants scheme. Data published by the Reserve Bank on new lending on mortgages by type of lender point to first home buyers gaining a greater share of such lending at the expense of investors. Volumes remain modest however at around $2 billion per quarter. This trend has only emerged recently (see Appendix Table 11).
2.2 House prices and affordability The massive house price inflation in Auckland is a well-known and well-discussed phenomenon, which for the sake of context is recorded in Figure 2.4 for the past 10 years. Median house sale prices nationally rose by around 40% over the past 10 years and by 30% over the past five years. Similar rates of price growth have been experienced in Wellington and Canterbury regions. Median price growth in Waikato region has been much stronger at around 45% over the past five years. By comparison, the median price of Auckland houses rose 65% over the past five years and by almost 90% over the last decade. For more detailed regional house price data see Appendix Table 12. FIGURE 2.4: MEDIAN HOUSE PRICE – NEW ZEALAND AND SELECTED REGIONS – 2007 TO 201726
Median house sale prices rose nationally by about 30% over the past five years
16
+30%
A Stocktake of New Zealand’s Housing – February 2018
There are a number of ways to consider housing affordability and two are offered in Figures 2.5 and 2.6. Figure 2.5 and the data reported in detail in Appendix Table 13 simply measure affordability by comparing average wages (of employees) and median house prices to calculate a measure based on the number of years at this wage required to purchase the median priced house. This measure is reported in Figure 2.5 for the two regional extremes of Auckland and Canterbury as well as New Zealand overall. These data clearly show the extent to which Auckland’s house prices have risen much faster than wages – a rise from around ten years’ wages in early 2012 to 16 years in 2016 although with a slight easing more recently. By comparison median house prices across New Zealand in aggregate and in Canterbury remained fairly stable against wages and salaries. FIGURE 2.5: HOUSING AFFORDABILITY – YEARS TO PURCHASE MEDIAN PRICE HOUSE – 2007 TO 201727
Figure 2.6 offers a more sophisticated affordability measure which incorporates the costs of servicing a mortgage against current house prices and incomes. Because interest rates eased considerably post-GFC and have remained close to historic lows ever since, affordability measures, which include interest rates, have shown a marked improvement in affordability (decline in the
17
A Stocktake of New Zealand’s Housing – February 2018
curves) especially outside Auckland. Continued price growth in Auckland – especially since 2013 – have eroded the affordability gains of lower interest rates and relative affordability in Auckland has according to this measure returned to around GFC levels. FIGURE 2.6: MASSEY UNIVERSITY’S HOUSING COST AFFORDABILITY INDEX – 2007 TO 201728
2.3 Housing ownership and wealth distribution The diminishing proportion of adults who own their home, and perhaps other housing, means that the windfall gains from recent property value appreciation have gone to perhaps 50% or 60% of adult New Zealanders. Most likely such gains have exacerbated wealth inequalities, although there is no up-to-date data available on this trend to confirm this. Recently the value of assets owned by New Zealand households was estimated to have reached $1.5 trillion.29 Figure 2.7 reports changes in the value of non-financial assets owned by New Zealand households between 2007 and 2016. For data on the structure and growth of this wealth see Appendix Table 14, which show that the value of non-financial assets – basically land and buildings – grew by 45% or $210 billion over the four years between 2012 and 2016. In comparison, the value of equities and other financial instruments grew by 28% over this period. This growth should be seen in the context that in 2015 it was estimated that around 10% of New Zealand’s households owned 50% of the wealth while the poorest 50% of households owned about 8% of the wealth.30 FIGURE 2.7: HOUSEHOLD WEALTH IN NON-FINANCIAL ASSETS – 2007 TO 201631
18
A Stocktake of New Zealand’s Housing – February 2018
3. New Housing
The construction industry and the land development sectors have a major impact on New Zealand’s housing landscape, both in terms of their capacity and performance. These sectors have not served the cause of affordable housing well although this poor service can partly be attributed to misguided or indifferent public policy. Such settings have meant that over the past five years house building has not kept pace with population growth – especially in Auckland, and that the housing being produced is becoming more and more expensive.
3.1 Population and housing stock changes There were just over 1.9 million private dwellings in New Zealand in December 2017, which provide housing for 4.9 million New Zealanders meaning an average occupancy rate of 2.6 people per dwelling. The growth in this housing stock has been reasonably uniform over the past 20 years as illustrated in Figure 3.1. Over this 20-year period the national housing stock has grown by just under 30% while the national population has expanded by almost 27% meaning of course that the average occupancy of our housing has fallen slightly from 2.66 people per dwelling in 1997 to 2.60 people per dwelling in 2017 (see Appendix Table 15). Such a decline in the average occupancy rate has been predicted as part of New Zealand’s falling birth rates and its aging population.32
There are now more than 1.9 million private dwellings in New Zealand
19
1.9m
A Stocktake of New Zealand’s Housing – February 2018
FIGURE 3.1: ESTIMATES OF THE NATIONAL HOUSING STOCK – 2007 TO 201733
However, if these changes are considered in five-year time-frames, rather than as a 20-year perspective a rather different story emerges as illustrated in Figure 3.2. For the two five-year periods between 1997 and 2007 growth in the housing stock comfortably exceeded population growth, by 3.5% between 1997 and 2002 and by 1.3% between 2002 and 2007. Such differences have accommodated the expected changes around the demographic trend to smaller households. Between 2007 and 2012 population change and housing stock change closely matched. However, between 2012 and 2017 population estimated growth outstripped estimated housing stock growth by 2.1%. This difference is the root cause of the present housing shortage – essentially, we have not built enough houses for our growing, but aging population. FIGURE 3.2: FIVE YEAR CHANGES IN HOUSING STOCK AND POPULATION – 1997 TO 201734
Population growth outstripped housing stock growth by 2.1% over 2012–2017 resulting in the housing shortage
20
+2.1%
A Stocktake of New Zealand’s Housing – February 2018
It is important to recognise the role which immigration of both New Zealand citizens and nonNew Zealand citizens has played in this recent population growth and this is shown in Figure 3.3 (data in Appendix Table 16). The sharp increase in net migration since 2014 is not entirely due to fewer people migrating to Australia as is sometimes argued. In the five-year period between September 2007 and September 2012, total net migration into New Zealand was 32,853 people, which was the result of a net loss of 148,790 people to Australia, offset by a net gain of 181,643 people from other countries. In the subsequent five years, between 2012 and 2017, net migration into New Zealand was 262,762 people, which is the result of a total loss of 29,610 people to Australia and a gain of 292,372 people from other countries. FIGURE 3.3: NET MIGRATION – 1997 TO 2017 (SEPTEMBER YEARS)35
3.2 New house building During 2017, consents for new private dwellings climbed back to the levels last seen in 2003 and 2004, which are around 30,000 to 31,000 annually. Figure 3.5 shows that consent numbers in excess of 30,000 annually were achieved in the early 1970s on a substantially smaller population and economic base than we have today (see data in table 17 in the Appendix). Consents also rose in the early 2000s. Data in this report do not cover the period after the war when local governments were encouraged to undertake building programmes, but show that once central government also essentially withdrew from building state housing in the 1990s, it took until 2003 to reinstate even a reduced role in such social infrastructure. The growing contribution from the NGO sector did not compensate for the lack of activity by government.
21
A Stocktake of New Zealand’s Housing – February 2018
New dwellings consented, by owner type, year ended November
FIGURE 3.4: NEW DWELLINGS CONSENTED, BY OWNER TYPE, 1970-2017 40000
35000 30000 25000 20000 15000 10000 5000 0
Central government (1975 onwards)
Local government (1991 onwards)
Non-profit sector (1991 onwards)
Other
New private dwelling consent numbers for the past 20 years for both New Zealand overall and for Auckland are reported in Figure 3.5 (see data in Appendix Table 17 ). While current levels of new house building compare favourably with the low levels of construction seen immediately after the global financial crisis, during the period 2009 to 2011, these current volumes are not historically exceptional particularly compared with the early 1970s. However data on government involvement in the 70s boom is not available. FIGURE 3.5: CONSENTS FOR NEW DWELLINGS IN AUCKLAND AND NEW ZEALAND – 1997 TO 2017 (MONTHLY)36
22
A Stocktake of New Zealand’s Housing – February 2018
Over the last decade Auckland has accounted for 30% of new dwelling consents but received 47% of New Zealand’s population growth
30%
For the past decade, Auckland has accounted for just under 30% of consents for new dwellings yet has received 47% of the country’s population growth. This difference indicates one of the sources of Auckland’s accumulated housing shortage which MBIE estimates at as many as 45,000 dwellings.37 Estimating such shortages relies heavily on the starting assumptions and it seems likely that this estimate, of a shortfall of 45,000 dwellings, is a top of the range one. Figure 3.6 provides an alternative estimate of this shortfall, which is based on the assumption that housing is required at a rate that maintains the present occupancy rate of three people per dwelling overall (data in Appendix Table 18). This shortfall is estimated at 28,000 dwellings over the past ten years. FIGURE 3.6: ESTIMATES OF POPULATION-BASED HOUSING DEMAND IN AUCKLAND – 2008 TO 201738
23
A Stocktake of New Zealand’s Housing – February 2018
Output costs within the residential construction industry appear to be rising at several times the rate of general inflation. This trend shown in Figure 3.7 compares the input and output Producer Price Indices (PPI) of the residential construction sector with the Consumer Price Index (CPI) for the past 20 years. The period since late 2012 has been a period of quite significant cost pressure with the output PPI rising more than 24% while the input PPI rose almost 11% and the CPI by just 5.2% (data in Appendix Table 19). The average construction cost of an ‘average house’ – rather than apartment – has risen 28% over the past five years and by 180% over the past 20 years (see data in Appendix Table 20)39. In late 2017, this average cost, New Zealand wide, was $395,000, while in Auckland it was $455,000. Such an ‘average house’ across the country is around 210m2 in area, while in Auckland it is just over 230m2. FIGURE 3.7: RESIDENTIAL CONSTRUCTION PRODUCER PRICE INDICES – 1997 TO 201740
3.3 Housing market constraints Work by the Productivity Commission details the constraints facing new supply, including that urban planning, land banking and other factors are slowing the supply of new homes.41 There are three key barriers to housing supply: planning, infrastructure funding and the development sector. Local government uses urban planning to ensure sufficient supply of land for each purpose, coordinated with infrastructure and other amenities. In fast growing areas, planning and co-ordinated infrastructure and housing delivery have not kept pace. The current planning approach does not seem to work for fast growing urban areas. Planning has become elaborate and complex, that adds costs, for example restrictions on the number of storeys for new dwellings and the requirement for car parks, which limit the provision of dwellings, without necessarily increasing amenity. When starting from a position of a shortfall of housing, it makes sense to consider tools like inclusionary zoning to speed up the supply of affordable housing that remain in that purpose. But some of those tools should be temporary, urban planning should plan far enough ahead and with sufficient margin so that there is an adequate supply of land, but in a way that limits urban sprawl. Urban planning is key to unlocking land supply including allowing higher density, so that more houses (including smaller, but quality houses) are built. Yet, although councils have a critical and legitimate role in shaping urban development, urban planning is seen as a significant barrier by many in the development community.42 In part, these tensions reflect challenges in resourcing and consequently culture. In fast growing urban 24
Urban planning is key to unlocking land supply, allowing higher density, so more houses can be built
A Stocktake of New Zealand’s Housing – February 2018
centres there are not enough resources to process all the consents being lodged. Combined with regulatory timelines, there is an incentive to act as a bouncer to delay processing applications. With additional time, planners can act as ushers, helping developers to a successful application. Local authorities have also become risk averse following the Leaky Building crisis (see later discussion), this is reflected in building consenting practices. The development and construction sectors are also a constraint. These sectors suffer from small scale43, low productivity, boom-bust cycles, upheavals in funding, and landbanking. The housebuilding industry in New Zealand is tiny. On average, there were two houses built per firm at the peak of the cycle, and less than one at the trough. Cyclical uncertainty discourages investment technologies like pre-fabrication (relatively common internationally), long-term planning, training of apprentices, etc. The result is that during booms, costs increase because there are not enough workers, capital and capability in these firms. During busts, many firms fail and many workers migrate to Australia, or leave the construction sector entirely. We are trapped in a small and volatile construction sector. Funding can also change quickly. Finance companies were significant suppliers of mezzanine capital for apartment and other relatively high density developments, which tend to be capital hungry. In the mid-2000s, many finance companies failed and that source of funding stopped, also stopping the apartment development sector.44 While apartment developments have gradually made a comeback, it has taken a long time to recover from the funding volatility. Many developers land-bank, or work with land-bankers. The incentives are strong, as land prices have appreciated the most of all components of house prices. The evidence of the extent of land-banking is patchy, but there is a disconnect between planning rules, land supply and house building. We need better evidence on the extent of land-banking, concentration of land holdings, use of restrictive covenants and pilots of what policies work (for example charging rates on land value to encourage the highest and best use of land).
3.4 Local government finances Even if planning constraints are eased judiciously, infrastructure can be a bottleneck. New developments often require large, upfront investments by councils or developers, the value of which mainly accrues to the developer or surrounding home-owners. The local authority shares in a small amount of the upside through rates, but none of the benefits of increased incomes, profits and spending, which accrue to central government. Without mechanisms to better connect the benefits and costs of growth, through revenue sharing or through targeted rates or bonds, fast growing local authorities struggle to provide sufficient key infrastructure, even if the land is in theory suitable for house building. Against such policy innovations it is important to be mindful of the increasing problems which local authorities are having with debt – especially Auckland Council. Across the whole local government sector, debt rose 83% between 2011 and 2016 to $13.8 billion, although financing costs as a proportion of rates revenue remained stable at around 12% to 13%.45 Auckland Council accounts for more than half this local government debt and in June 2017 that Council reported a total debt of $8.3 billion. This figure is an increase of almost 65% over the $5.0 billion owed by Auckland ratepayers in mid-2012. As a proportion of rates revenue, financing costs have risen from 22% in 2012 to almost 29% in 2017 46 (see data on local government finances in Appendix Table 21). While the value of the assets, especially for future generations, need to be taken into account, the question needs to be asked about the ability of local councils and especially Auckland Council to take on further debt to fund growth and related infrastructure resilience in the event of rising interest rates, and whether existing practices and approaches to funding infrastructure are optimal. 25
A Stocktake of New Zealand’s Housing – February 2018
4. State and Other Social Housing
There remains some contention around the use of the term social housing to describe state housing or housing which is owned by Housing New Zealand (Housing NZ) on behalf of the Crown. Social housing can be described as housing which is affordable and allocated on the basis of need by registered housing providers within a regulated framework.47 The contention here is not that social housing is necessarily state housing, but that the previous Government adopted the term social housing, somewhat ambiguously, to describe a wide range of housing provision. These included private for-profit investors alongside state, local government and NGO providers. For clarity in this chapter state housing is treated separately from other social housing models.
4.1 The social housing stock in New Zealand Social housing – including state housing – can be divided into two broad groups in terms of how it is funded. The Ministry of Social Development (MSD) partially funds the majority of social housing units through its Income Related Rent Subsidy programme (IRRS). Some state housing, anomalously most Council-owned social housing and much of the Community Housing Provider (CHP) social housing stock are not directly funded by the Crown through IRRS. However, Wellington City Housing successfully demonstrates a model where the Crown provided half the capital for the on-going refurbishing of 10 modernist apartment blocks in the early 2000s.48 Nonetheless the eligibility of these apartments for IRRS remains in contention and is an important unresolved policy issue with national implications. Estimates of the numbers involved in each of these categories in late 2017 are provided in Table 4.1. A regional breakdown of this stock is provided in Table 22 in the appendices. TABLE 4.1: ESTIMATES OF STATE AND OTHER SOCIAL HOUSING STOCK – MID 201749
Receiving IRR subsidies Not receiving IRR subsidies Total
26
Housing NZ
Local councils
NGOs & others
Total
58,500
0
4,800
63,300
4,400
7,700
7,900
15,300
62,900
7,700
12,700
83,300
50
A Stocktake of New Zealand’s Housing – February 2018
Over the last decade the number of dwellings owned or managed by Housing NZ peaked in mid2011 at 69,717 units falling to 62,917 units in June 2017
–62,917
4.2 Changes in state housing stock Over the past ten years the number of dwellings owned or managed by Housing NZ peaked in mid-2011 at 69,717 units, falling to 62,917 units in June 2017. Of these dwellings Housing NZ actually owned 66,127 units which fell to 60,301 units in 2017. The remaining units are leased from private investor/owners. This 2017 figure is the lowest number of state houses in Crown ownership since 2000. Trends in the numbers of state houses for the past decade are reported in Figure 4.1. The recent sharp decline in numbers of state houses in Crown ownership is partly on account of the transfer of 2,800 units from Housing New Zealand to Tamaki Regeneration Company in April 2016. This company is jointly-owned by the Crown and Auckland Council and is charged with the redevelopment of the eastern Auckland suburbs of Glen Innes, Point England and Panmure. Accepting that these 2,800 units remain in public ownership the number of state house units now owned fully or partly by the Crown has fallen 5% or by approximately 3,250 units since 2011. This decline has come about through a combination of sales and demolitions. Under the previous Government’s social housing reform programme approximately 500 state houses have been removed from Crown-owned sites to make way for the further addition of state and private sector housing. This decline in the number of state houses in Crown ownership against a background of a growing national housing stock means of course that the share of this stock has fallen over the past decade. This decline is from an estimated 4.0% of the national housing stock in 2008 to 3.4% in 2017. Data on Housing New Zealand’s stock including regional breakdowns are in Appendix Table 23. FIGURE 4.1: DWELLINGS OWNED OR MANAGED BY HOUSING NEW ZEALAND – 2008 TO 201751
27
A Stocktake of New Zealand’s Housing – February 2018
4.3 Changes in the stock of other social housing The stock of social housing owned and provided by non-Crown agencies including local government and NGOs rose quickly between 2015 and 2017 mainly as a result of the previous Government’s policy on social housing. An estimate from early 2017 suggested that there were just under 20,000 social housing units outside Crown ownership of which around 12,000 were owned by NGOs and just under 8,000 units by local councils.52 Community Housing Aotearoa estimated that in late 2017 12,651 units were owned by community housing providers. The numbers of social housing units in NGO ownership has grown rapidly over the past two years due to major transfers or sales. These include: • The sale of 344 units by Hamilton City Council to Accessible Properties in March 2016. • The transfer in April 2016 of 2800 units from Housing NZ to the Tamaki Regeneration Company, which is a joint venture between the Crown and Auckland Council. • The long-term leasing of 2,250 units by Christchurch City Council to a Council owned entity – Otautahi Community Housing Trust in October 2016. • The sale of 1,138 Housing New Zealand units in Tauranga to Accessible Properties in April 2017. • The long-term leasing in July 2017 by Auckland Council of 1,452 units to a limited partnership venture with the Selwyn Foundation – the partnership is known as Haumaru Housing.
4.4 Demand for social housing Actual demand for social housing is difficult to measure accurately. In part, this is because such measurement relies on the administration of an application and review process, which might, intentionally or unintentionally, have barriers or biases to recognising all unmet housing need. A commonly accepted indicator of unmet demand for social housing need is the social housing waiting list or register, which is administered by MSD and has been since June 2014 when this function was taken from Housing NZ. Figure 4.2 provide data on trends in the social housing waiting list since June 2014 (see data in Appendix Tables 24 to 27). In September 2017, the number of households seeking social housing and deemed to have a serious enough housing need to be on the waiting list reached 5,844. This figure was 27% higher than a year previously and 72% more than in September 2015. Around 70% of this unmet housing need was accorded the highest urgency status – Priority A. The number of households given Priority A more than doubled between September 2015 and September 2017. FIGURE 4.2: SOCIAL HOUSING WAITING LIST - 2014 TO 2017.53
28
A Stocktake of New Zealand’s Housing – February 2018
The sharp increase since mid-2016 in the numbers of households put on the social housing waiting list is difficult to explain on the facts available. Part of the answer is likely to be the big up-turn in general housing demand with the rise in migration. However, at this time there was no nation-wide shock in housing markets, which would cause unmet housing need to rise by more than 50% nation-wide and by more in housing markets as diverse as those in Waikato, Wellington and Hawkes Bay. MSD does however appear to have changed the way it administers the social housing application process. Somewhat curiously MSD does not record the numbers of initial enquiries it receives for housing assistance, although it does count the numbers of assessments completed once people get past an initial vetting process. Between March 2016 and March 2017 the numbers of assessments and the numbers of households placed on the social housing register or waiting list rose 40% and 58% respectively (see data on a regional basis in Appendix Tables 28 and 29).
4.5 Future provision of social housing MSD have published their social housing purchasing intentions through to 2020 and an analysis of these is provided in the Appendix Table 30. Between 2017 and 2020 the Ministry plans to increase the numbers of residential units receiving an income-related rent by 3,790 of which half will be in Auckland. Of these additional units approximately 2,600 have been identified, while 1,200 have still to be found. However the bulk of the identified additional units (1,300 approximately) have been transferred from local council stock into stand-alone entities in order to receive an IRR subsidy. A further 500 units, approximately, are existing Community Housing Provider (CHP) owned social housing units, which have been brought into the IRR programme. It appears from the information available in MSD’s purchasing strategy that of the 2,600 additional IRR subsidised units, which have been identified, less than 10%, or just 226 are actual new builds. However, additional new units identified in the so-called ‘supply pipeline’ may have eventuated since then, raising this number to as many 690.
29
A Stocktake of New Zealand’s Housing – February 2018
4.6 The financial performance of Housing New Zealand A summary of Housing NZ’s financial position and performance for the past ten years is offered in Table 10 in the Appendix. Figure 4.3 provides an indication of the ten-year trends seen in Housing NZ’s revenue from tenants’ rents and from IRR subsidies from the Crown. In nominal terms, the IRR subsidies have grown almost 60% over the past decade, while tenants’ rents have remained relatively static. The main reason for this stability in tenant’s rent income is because of the falling numbers of state houses owned or managed by Housing NZ, as illustrated in Figure 4.1 and in Table 31 in the Appendix. Other key outcomes emerging from the financial data offered in Table 31 include: 1. The extent to which the Crown has not supported Housing NZ in capital terms; over the past five years (2012 to 2017) the Crown received $305 million in dividends from the company yet provided just $4 million in additional capital. 2. The recent increase in spending on repairs and maintenance rising from $174 million in 2012 to $315 million in 2017. 3. The gradual increase in Housing NZ’s financial value and hence its contribution to the net worth of the Crown. This increase is mainly due to asset appreciation in housing markets New Zealand wide. Between 2012 and 2017 Housing NZ’s net assets rose more than 75% to $21.6 billion. This is 20% of the Crown’s net worth.54 4. Housing NZ is required to pay taxes, unlike the current tax advantages of negative gearing available to private landlords. Over the past ten years the company paid $1.18 billion in tax including $779 million in 2009/10 as a result of a change in depreciation rules. In 2017 Housing NZ still maintained a deferred tax liability of $2 billion in its accounts. FIGURE 4.3: HOUSING NEW ZEALAND’S REVENUE FROM RENTS AND SUBSIDIES – 2008 TO 201755
30
A Stocktake of New Zealand’s Housing – February 2018
5. Housing Assistance
Government housing assistance is provided through a number of programmes, which are forms of both demand subsidies, those going directly to the household or person being supported, or supply subsidies which are paid to the provider of affordable housing. These subsidies mainly support rental housing through the Accommodation Supplement (AS) and the Income-Related Rent (IRR) programme, which are administered by MSD. Subsidies also support homeownership partly through the AS and partly through the Homestart grant programme. A recent extension of Government’s housing assistance programme has been the roll out of supply and demand subsidies for emergency housing.
5.1 Housing assistance budgets In the current financial year, the Government has budgeted to spend $2.3 billion on various forms of housing subsidies. On top of these subsidies is a budget of approximately $50 million, which supports the administration of these programmes. Estimates of the cost of the various programmes are provided in Appendix Table 3A for the 2017-18 financial year. Table 5.1 reports the value of housing subsidies over the past decade. Since 2008, housing assistance budgets have grown by $695 million in nominal terms, or by just over 50%. Most of this increase is due to the growing cost of the IRR subsidies, which support around 65,000 households in social housing. The annual cost of this programme grew by almost 80% or by $374 million between 2008 and 2017 to $848 million. However, the number of social housing units supported in 2017 was similar to that supported in 2008. Annual budgets for the AS grew by 27% in nominal terms or by $238 million between 2008 and 2017. In the 2016-17 financial year Government spent $1.13 billion on the AS programme and made payments to 290,000 households or individuals. Background data for Table 5.1 and Figure 5.1 are provided in Table 32 in the Appendix. TABLE 5.1: HOUSING ASSISTANCE BUDGETS IN $ MILLIONS – 2017/1856
Emergency housing Renting
Supply subsidies
Demand subsides
Total
49
40
89
900
1,128
2,028
192
192
1,360
2,309
Homeownership Total
31
949
A Stocktake of New Zealand’s Housing – February 2018
FIGURE 5.1: GOVERNMENT HOUSING ASSISTANCE BUDGETS – 2008 TO 201757
5.2 Income-Related Rent (IRR) subsidies During the 2016/17 financial year, the Government spent $848 million on IRR which assisted almost 63,000 households in social housing. Of this number 93% or approximately 58,300 were state houses owned by Housing NZ.58 In its 2016/17 Annual Report Housing NZ reported revenue from the Crown of $758 million to support IRR subsidies. The remaining $90 million has been paid to CHPs.59
5.3 Accommodation Supplement (AS) The AS is New Zealand’s second biggest income support programme after New Zealand Superannuation. The AS is paid to eligible New Zealand residents, who qualify in terms of housing costs relative to their incomes. However more than 85% of the people receiving it are also receiving either a working age benefit or Superannuation. This has meant that demand for the AS tends to move with demand for working age benefits as shown by data provided in Table 33 of the Appendix. In late 2017, there were approximately 285,000 individuals, couples or family households receiving an AS. This number has declined by 7% or by 21,000 since September 2012.
32
A Stocktake of New Zealand’s Housing – February 2018
Two-thirds of recipients of the AS or around 189,000 households are private sector tenants and collectively they receive 75% to 80% of the total spent on the Supplement. For the 2016/17 financial year this spend amounted to approximately $870 million. Households renting and receiving the AS make up 27% to 28% of all tenant households (see Appendix Table 34 for regional estimates of the rental housing stock and AS payments). In the 2017 Budget, the previous Government announced that it was increasing the maximum payments available under the AS programme from 1 April 2018. The current government is retaining these changes. These maxima are set on a regional basis60 and were last adjusted in 2005, when they were based on median rents from 2003.61 An adjustment was long overdue although in a tight rental housing market the opportunity for these higher subsidies to leak into higher rents is particularly strong. As noted earlier, the extent to which the AS is effectively a tenants’ or landlords’ subsidy is unclear, but will be partly determined by the available supply of rental housing and will be tested by changes in rents during mid-2018 as this increased expenditure feeds through.62 One consequence of this past failure to adjust the parameters around the AS to take account of rising rents is that more and more recipient households reach the maximum payment and are then obliged to pay any further rent increase out of the their residual income. As illustrated in Figure 5.2 the proportion of tenant households receiving the AS, who reached the maximum payment rose from 38% in June 2008 to 58% in June 2017. Data on the regional differences in this proportion at the maximum are provided in Table 35 of the Appendix. These data show that the highest proportion of tenant households at the maximum is found in Northland and Waikato and the lowest is found in Auckland where the maximum is highest. FIGURE 5.2: PROPORTION OF TENANT HOUSEHOLDS RECEIVING THE MAXIMUM ACCOMMODATION SUPPLEMENT PAYMENT – 2008 TO 2017.63
While the number of people receiving the AS has declined over the past five years further declines are not anticipated.64 One reason for this expected stability is the increasing number of older people needing the AS to top up their Superannuation in order to afford housing. Since 2012, this number has risen by 22%, or by almost 10,000 people. As a proportion of people receiving Superannuation, those also receiving the AS has risen from 5.0% in 2012 to 5.4% in 2017. Tenants make up more than 70% of these people and the number of tenants receiving both payments has grown by 33% since 201265 (see data in Appendix Table 36). Much of the future demand for housing assistance will come from older tenants.
33
A Stocktake of New Zealand’s Housing – February 2018
5.4 Other housing support programmes Two other notable housing assistance programmes are the emergency housing programme and the Homestart Grant Scheme for first time homebuyers. Financial details of these programmes are provided in Table 32 of the Appendix and the volumes associated with the emergency housing programme are dealt with in a separate section to this stocktake report. Volumes of applications and approvals for Homestart grants are reported in Appendix Table 37 for the three-year period July 2014 to June 2017. Over this period, 74,100 applications were received and 55,600 were approved. Since the scheme actually began pay-outs in April 2015, a total $148 million has been granted.66 Consistent with Māori and Pacific peoples’ lower than average home-ownership rates these ethnic groups have a lower take-up of Government backed home-ownership assistance programmes, although the gaps are not as wide as for home-ownership overall. Between July 2012 and June 2016 Māori, who in 2013 constituted 16% of the population, make up 14.3% of those being paid a Kiwisaver deposit subsidy, or a Homestart grant. While Pacific Island people, who constituted 8% of the population in 2013, were just 4.4% of the recipients of these home ownership subsidies.67
5.5 Future budgets The 2017 Budget made forecasts of significant increases in housing assistance budgets. These forecasts are offered in Table 5.2 for the period through to June 2021. Over the next four years allowance has been made to expand housing assistance budgets by $500 million per year. TABLE 5.2: FORECASTS FOR HOUSING ASSISTANCE BUDGETS IN $ MILLIONS – 2017 TO 202168 Year ending 30 June
2017
2018
2019
2020
2021
Accommodation Supplement
1,129
1,218
1,488
1,497
1,515
Income related rent subsidies
848
900
985
1,048
1,105
1,977
2,118
2,473
2,545
2,620
Totals
34
A Stocktake of New Zealand’s Housing – February 2018
6. Homelessness and Emergency Housing
Homelessness has become a key concern for New Zealanders, and is a key indicator as to whether the housing system is working. Despite allocation of $43 million to emergency housing, there is no systematic recording or monitoring of homelessness on a month-by-month or year-by-year basis. There are no data on the ‘floating population’ – homeless people who do not, or cannot, access government housing assistance, or are turned away from community agencies because they have no capacity to provide help. MSD acknowledge that there are a significant number of homeless households, who are not on the social housing waiting list, but the scale of this problem is unknown. Apart from Census data, we currently have no reliable way of knowing whether the homelessness problem is improving or deteriorating, and whether funding put into homelessness services is actually working to reduce homelessness.
6.1 Census information on homelessness There was a significant rise in the level of homelessness (or ‘severe housing deprivation’) between the 2006 and 2013 Censuses, with at least one in 100 people homeless in 2013 compared to one in 120 in 2006.64 This was an estimated 4,197 people without habitable accommodation and 37,010 in temporary accommodation, or sharing in severe overcrowding in 2013.70
Significant increase in homelessness between 2006 and 2013
6.2 Assessments of recent changes in homelessness Data from a sample of community emergency housing providers, collected from agencies for this report in December 2017, showed that the level of homelessness far outstrips the current level of available assistance. Over 2017, the ‘turnaway rate’ for these providers ranged from 82% to 91% – that is, for every 10 homeless people who approached them, requiring housing, only 1 to 2 people could be accommodated. The data from these providers paint a picture of both desperate families and workers from a range of government agencies going through a laborious process of calling around, looking for emergency housing. The need for a more modern, coordinated system is clear. Table 6.1 shows the limited extent of up-to-date knowledge about the scale of homelessness. With better systems, the homeless population could be regularly measured and monitored, as a first step towards better support.
35
A Stocktake of New Zealand’s Housing – February 2018
TABLE 6.1: RECENT KNOWLEDGE OF THE SCALE OF HOMELESSNESS71 Homelessness category
What we know about current size of problem
WITHOUT SHELTER
City
Number of people
Living on the streets, improvised dwellings, cars
Auckland
pending
Christchurch
215
Hamilton
pending
Napier
35
Council estimate
Tauranga
70
Council list – Dec17
Wellington
60
DCM – Nov17
Source
Street count – Nov17
TEMPORARY ACCOMMODATION NGO run emergency/transitional accommodation
421 households (Nov-17) in MSD-funded motel/boarding house rooms
Motels, camping grounds, boarding houses and marae
No recent data on other NGO accommodation in boarding houses, camping grounds and non-MSD funded motels and marae
SHARED ACCOMMODATION Living as a temporary resident with friends or family (including garages)
No recent data available
6.3 Emergency housing responses In recognition of rising levels of concern about the number of people living in cars and street homelessness, the previous Government commenced an emergency housing response in mid-2016. This response had a number of dimensions including: 1. An increase in the numbers of people having their housing needs assessed by MSD. This number rose from 4,440 during the March 2016 quarter to 7,693 during the September 2017 quarter72 (see Appendix Table 28 for details). 2. On the back of these additional assessments the waiting list of people or households on the social housing register rose 65% between March 2016 and September 2017 to 5,84473 (see Appendix Table 29 for details). 3. The number of households on the social housing register who were identified as being in insecure housing (Priority A), grew 90% during the 12 months to 30 September 2017 to 2,168.74 4. The provision of places in transitional housing for homeless individuals and families grew by 160% between September 2016 and September 2017 to 1,663 and is set to reach a target of 2,155 by early 2018 (see Appendix Table 38 for a regional breakdown of this provision). 5. Between September 2016 and September 2017 MSD provided almost 38,700 emergency housing special needs grants. This provision appears to have peaked in May 2017 at almost 4,300 (see Figure 6.1 and Appendix Table 39 for details).
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A Stocktake of New Zealand’s Housing – February 2018
FIGURE 6.1: PROVISION OF EMERGENCY HOUSING SPECIAL NEEDS GRANTS - 2016 TO 201775
6.4 Housing First Internationally, evidence shows that emergency housing only works for some people, whereas resources to provide and ensure adequate permanent housing is better for addressing homelessness.76 Housing First has been up and running in Hamilton for several years with mainly private funding and in Auckland since early 2017 with government funding. Government funding to address homelessness is currently weighted towards temporary emergency housing, though funding of $16.5 million was allocated to expand Housing First to additional areas of high housing demand, as well as funds targeted towards sustaining tenancies, in Budget 2017.
After living rough on and off the streets for many years, Rangitahi (pictured) was one of the first to work with The People’s Project when it began offering Housing First services in Hamilton in 2014.
37
Resources to provide permanent housing is better for addressing homelessness
A Stocktake of New Zealand’s Housing – February 2018
7. Security of Tenure
7.1 Security of tenure in rental housing Security of tenure in the rental market has been declining in both private and state rental housing. The proportion of people in state housing compared with private rentals has changed significantly between 1991 and 2013. The proportion of renting households who did not own their home and rented in the private sector rose from 60% to 83%. For Māori, the proportion of households renting privately increased from 41% to 77% and for Pacific peoples increased from 27% to 56%. This rise in households renting privately appears to be fuelled by the decline in the state housing stock (which is also under-counted in the Census): in the same period, the proportion of people renting state housing dropped by 16 percentage points for the total renting population, by 29 percentage points for Māori, and 27 percentage points for Pacific peoples.77 The sale of state houses has been accompanied by the tightening of inclusion rules and the introduction of ‘reviewable tenancies’, which has led to increased household movement, or ‘churn’ within state housing. Over the past four years, 42,512 state tenants have left Housing NZ properties, including people who left because they went to a rest home, hospital, prison or died. The homes of 3,715 of these tenants were transferred to two other providers (Tamaki Regeneration Company and Accessible Properties Tauranga). According to data supplied by Housing NZ, 5,739 tenants left when Housing NZ (informed by MSD, which has been responsible for tenancy eligibility, managing the housing register, calculating IRR and conducting tenancy reviews since 2015) initiated a termination. Tenancy termination may occur for a variety of reasons, including becoming ineligible because household income crosses a threshold, rent arrears, or damaging the dwelling. When a state tenancy is terminated the consequences can be serious. Losing a home can be devastating to health, education and other outcomes.78 79 Having been in arrears, in debt, or having a household member or associates who damage property (which may occur due to issues such as addiction and domestic violence) are all indicators that former state tenants are likely to find it difficult to find a home in the private sector, and may be at risk of homelessness. Recent work to support state tenants to retain tenancies may reduce this risk and could be beneficial for tenant well-being.80 This support could also be extended to private tenants, who are also likely to be at risk of homelessness when they experience eviction.81 As a consequence of the rise in residential property values, there appears to have been an increase in private rental house sales for owner occupation, adding to the shortage of private rental properties, so that as mentioned previously average rents have risen faster than average incomes (with the exception of Christchurch).82 For the most common ‘periodic’ tenancies, section 51(1)(d) of the RTA allows landlords to give 90 days’ notice without reason (tenants can give 21 days’ notice without reason). However, fixed-term tenancies can only be ended early by mutual agreement or on application to the Tenancy Tribunal (see section 50 of the Residential Tenancies Act). While 12 month, fixed-term tenancies are the most common type of tenancy recorded on rental agreements, at the completion of the 12 month term, many of these become periodic.83
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A Stocktake of New Zealand’s Housing – February 2018
A recent BRANZ report found that 36% of Auckland tenants who moved in the past two years did so because the house they were renting had been sold
36%
SOLD
A recent BRANZ report found that of those tenants who had moved in the past two years, 30% of the sample nationally and 36% in Auckland did so because the house they were renting had been sold.84 While this is a sub-sample of renters, the average length of time households stay in rental properties is increasing, reflecting the shortage of supply and affordability of rental properties, as well as the difficulty of moving from rental properties to home-ownership. In 1995, rental bond data showed that the average tenancy was 1 year 4 months; in 2017 the average tenancy is 2 years 3 months. In the 2013 Census, around 60% of renters had been in their current property less than three years, whereas only 30% of home-owners had been in their property for less than five years.
7.2 Impacts of residential mobility Moving houses is becoming a more common experience in New Zealand.85 Recent research from the Growing Up in New Zealand study found that between birth and nine months, children born into families residing in private rental accommodation were the most likely to have experienced early mobility, with nearly one in two (49%) having moved at least once, compared to fewer than one in five experiencing mobility if their families were home owners.86 The Dunedin Multidisciplinary Study found that half the 209 young people whose parents were renting in the original study, had lived in eight or more houses by the age of fifteen; only two had never moved. The average length of time spent in each house for all the young people was approximately 20 months.87
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A Stocktake of New Zealand’s Housing – February 2018
Household movement has a number of major health, educational and social costs, which appear to have been neglected as important housing policy ‘spill-over’ effects. The consequences of frequent moves can be myriad. People who move often are less likely to be affiliated with a primary health care provider (doctor, nurse or medical centre).88 Research carried out by the NZ Council for Educational Research89 and Ministry of Education shows that residential mobility is often associated with a change of school, increasing the disruption to children’s lives. School enrolment data for the cohort of students born in 2000 showed that almost half (48%) of school changes (aside from ones from primary to intermediate to secondary schools) were associated with a change of residential address for the child’s mother. As of March 2015, while 51,000 students had attended fewer than five schools, 6,000 mobile students had attended 5-7 schools and 1,000 very mobile students had attended eight or more schools. There is international evidence that the negative impacts of moving are greatest when children move both residence and school, and indeed mobile and very mobile students were more likely to receive special education services and show up in truancy data. Compared with other students in the 2000 birth cohort, mobile and very mobile students were more likely to have had a justice intervention by their 15th birthday. Among very mobile students: 11% had at least one youth justice referral, compared with 0.8% of students in the cohort as a whole; 5% had at least one youth justice placement, compared with 0.2% of students in the cohort as a whole; 30% had at least one police proceeding, compared with 5% of students in the cohort as a whole.90
7.3 Tenure changes for households with children When the regulation and enforcement of rental quality is weak and landlords favour periodic or relatively short-term fixed tenancies, declining home ownership particularly affects children. The proportion of children younger than 15 living in rental dwellings increased even more than for the total population between 1986 and 2013, from 26% of children to 43% (up 65%). This increase in children in rental properties occurred at a time when the proportion of children in the population fell from around one-quarter to just over one-fifth of the population. Falling home-ownership rates have had most effect among young children in Māori and Pacific people populations. In 1986, around half of Pacific people and Māori children lived in owneroccupied dwellings, but by 2013 only 39% of Māori children and 28% of Pacific children lived in a dwelling the household owned. Rates were even lower for children younger than 1 year, with just
The proportion of children younger than 15 living in rental accommodation increased from 26% of children to 43% (up 65%)
40
+65%
Falling homeownership rates have had most effect among young children in Māori and Pacific people populations
A Stocktake of New Zealand’s Housing – February 2018
over one-quarter of Pacific babies and around one-third of Māori babies living in an owner-occupied dwelling. Figure 7.1 illustrates that owner-occupation (home ownership) is highest among older age groups, lowest among young adults as they move around with mobility and independence, and among Pacific peoples, and below average for young age groups (such as under-10s).91 FIGURE 7.1: PROPORTION OF PEOPLE LIVING IN OWNER-OCCUPIED DWELLINGS BY AGE - 201392
International studies have found that children who move house in the first year of life are at substantially increased risk of emergency admissions for potentially preventable hospitalisations in early childhood.93 Children living in rental accommodation are more likely to be hospitalised, especially for diseases linked to housing, more likely to be re-hospitalised, and more likely to die young. The Ministry of Health (MOH) has labelled some diseases ‘Housing-Sensitive Hospitalisations’, for which approximately 6,000 children are admitted each year. These children are 3.6 times more likely to be re-hospitalised and 10 times more likely to die in the following 10 years.94 Addressing insecure, poor-quality rental housing therefore presents a critical need and opportunity for early intervention, to prevent the initial hospitalisation, and to prevent subsequent hospitalisations and deaths.
7.4 Tenure changes for older people While home ownership has been steadily declining in younger age groups, for the last two decades (1994 to 2016), home ownership for people aged over 65 years has been steady at around 86%, with 12-13% renting and 6.7% living with others in a home that the other residents own (boarding).95 Renting does however vary by area and is highest in Auckland (36%).96 The proportion of older people living in a house that is mortgage-free has dropped to 72%, which is a concern as it increases the number of people who have inadequate after-housing cost incomes; 33,708 people over the age of 65 were living in non-private dwellings in 2013, mostly in residential care for the elderly, with small numbers in dwellings such as boarding houses.97 For example, an increasing proportion of retired people are renting because they have not been able to buy their own homes. If they are renting under a periodic tenancy and are given 90 days’ notice, they will often be placed in an extremely difficult position in the current rental market. Similarly, while Housing NZ and council housing used to have discretionary rules for long-standing tenants who crossed the income threshold to pay market rather than subsidised rents these seem to be being phased out.
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A Stocktake of New Zealand’s Housing – February 2018
8. The Social Costs and Benefits of Housing Quality
Housing quality is not just an aspect of market value. Variations in housing costs do not necessarily correspond to variations in quality, particularly for rental housing. We spend most of our time indoors in our houses98, so the quality of our housing and the indoor environment is important to our health and well-being. As in a number of countries with temperate climates, dwellings in New Zealand have poorer thermal efficiency, which makes them harder to heat than well-insulated houses in more extreme climates. The thermal efficiency of our houses, as well as socio-economic factors and energy affordability, play important roles in determining whether a dwelling is sufficiently warm to keep the occupants healthy.99 As estimated by BRANZ and noted by the OECD100, only around two-thirds of New Zealand houses are even partially insulated, which makes the remainder cold, less energy efficient and more costly to heat, which has a direct effect on the health of occupants.101 The recent BRANZ House Condition Survey based on independent assessments indicated that whilst just over half (53%) of houses had inadequate retrofitted insulation in the roof space and/or subfloor, the proportion was higher in rented homes.102 In winter, 5% of households did not usually heat living areas at all and almost half did not usually heat any occupied bedrooms. Owner-occupied households had access to more cost-effective heaters, such as heat pumps, low-emission wood burners and flued gas heaters, than did renting households, who, despite the risks to health and risks of fire, typically rely on more expensive and less effective heaters, such as unflued gas heaters, which were used to heat 17% of living areas and 6% of bedrooms.103 More effective home heating has been shown to reduce school absences.104 A recent Statistics New Zealand Report on Energy Hardship replicated earlier research,105 106 showing that using a variety of different measures, up to a third (29%) of New Zealand households struggled to afford their power bills, spent a larger part of their income on power, or often felt cold. Around two-thirds of low-income households experienced one or more energy hardship indicators and were three times more likely than all households to have three or more energy hardship
29% of New Zealand households struggled to afford their power bills, spent a larger part of their income on power, or often felt cold
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29%
A Stocktake of New Zealand’s Housing – February 2018
indicators (9% compared with 3% of all households). Again, renters were more likely to experience energy hardship, with 44% of renting households reporting at least one energy hardship indicator compared with 22% of households who owned their own home.107
8.1 Risk factors in the indoor environment Apart from making dwellings damp and harder to heat, low indoor temperatures are an important health hazard, especially for babies, children, older people and those with chronic illnesses and disabilities. Temperature and relative humidity are important factors influencing comfort and health of building occupants. Cold temperatures and excessive moisture give rise to mould growth, presenting a health risk and causing building material deterioration. A recent case-control study has shown that babies exposed to damp and mould have significantly more wheezing.108 A BRANZ report measured temperature and relative humidity across 83 homes in New Zealand in 2015. The small sample size means the results should be treated with caution, but they are useful indications. The current WHO recommendation for indoor temperatures is 18°C. The median temperature inside bedrooms was 16.4°C and the relative humidity levels were above 65% for 46% of the time.109 Bedrooms were found to be below 18°C for 84% of the night and morning time period (23:00 to 9:00). Lack of heating and/or ventilation in these dwellings may also contribute to mould growth with its potential adverse health effects. Using the mould index, which will be used in the 2018 Census, almost half the homes in the BRANZ study showed mould growth, including in bedrooms. The results showed that for two thirds of respondents (66%), their bedroom was colder than they would have liked for at least some of the time in winter than those in owner-occupied dwellings.110 111 FIGURE 8.1 BEDROOM ROOM TEMPERATURES112
The evaluation of the Warm Up New Zealand: Heat Smart programme found that retrofitting homes with insulation produced health-related savings/benefits (including reductions in GP visits, reductions in time off work and school, reduced household level hospitalisation costs, pharmaceutical use costs, and reduced mortality for vulnerable elderly people) of $860 per year per household. All these results were statistically significant, but the benefits were driven by the value of reductions in mortality risk for vulnerable elderly people.113 114 115 Given that the OECD, presumably based on EECA data, estimated that at least one third of our 1.8 million private dwellings may be under-insulated116, this suggests that if all dwellings were adequately insulated, New Zealand might gain ongoing annual health-related benefits of approximately $0.5 billion. The Housing, Heating and Health Study showed that retrofitting insulation and installing effective home heating decreased wheezing in children with asthma and reduced their number of sick days off school.117 118
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A Stocktake of New Zealand’s Housing – February 2018
8.2 Crowding and other risks Crowding is increased by social and economic factors, such as the decline of affordable housing, the rising level of rents in most cities and the lack of security of tenure in the private rental market, which leads to many households ‘doubling up’ to reduce per-person rents. Data from the 2013 Census shows a mixed picture of crowding. The proportion of people living in crowded households and the proportion of crowded households has dropped, but the number of households and number of people living in them has risen.119 Data from the 2013 Census using a variety of crowding measures showed that around 10% of people live in crowded conditions, with the highest proportion in Counties Manukau DHB region (22%), followed by Auckland (16%) and then Tairawhiti (15%). Children are over represented in crowded households, with over half of crowded households having two or more children living in them. Two in five Pacific people (38%) and one in five Māori (20%) and Asian (18%) people live in crowded households, compared to 1 in 25 Europeans (4%). There is an income gradient with 9% of those people living in crowded households not using any form of heating in their houses.120 People in some low-income households endure crowding as a way to keep warm and this is likely to be one of the main drivers of our high rates of close-contact infectious diseases, especially among children and particularly Pacific and Māori children, where the rates of hospitalisation are double those for European children.121 Tuberculosis acquired in New Zealand is significantly associated with household crowding.122 Approximately 10% of hospital admissions per year for diseases such as pneumonia, meningococcal disease and tuberculosis are attributable to household crowding; for Māori and Pacific people, the number is 20% of hospitalisations.123 While use of administrative data can give an estimate of the maximum extent of the impact of housing on hospitalisations, it is important to note that these are indicative figures and do not necessarily establish causation. Data from the MOH, using their classification of potentially avoidable housing-related hospitalisations, estimate the cost for children aged 0-14 was around $96 million in 2016/17. Using a slightly wider list of diagnostic codes, hospitalisation costs for all age groups in 2016/17 was almost $350 million. However, the MOH classification are indicative only, as they mainly include respiratory data, but do not include cardiovascular or home injury data, both of which are increased by home hazards. Other studies, which have included mortality as well as hospitalisation, suggest that the true total cost of poor housing is much greater. In 2013, the minimum cost of childhood asthma in New Zealand was $58.3 million. Some $37.8 million of that came from mortality (years of life lost). Adult asthma minimum costs were $264.3 million ($198.7 million mortality). Minimum total asthma costs, which included some costs not able to be disaggregated by age, were $858.2 million ($236.4 million mortality). For all respiratory disease, the total cost was at least $6.2 billion ($4.4 billion mortality). These are minimum, direct costs, and do not include indirect costs such as the long-term impact of interrupted schooling and mental health costs.124 The extent of the under-estimation of overall housing-related health costs can also be gauged from another recent study, which analysed national NZ hospital discharge data (2000-2014) using the Integrated Data Infrastructure to compare different measures of housing related hospitalisation. Using the MOH measure of Potentially Avoidable Hospitalisations, 619,667 hospitalisations affecting 390,220 children and 1,469 deaths occurred. Children with Potentially Avoidable Hospitalisations had twice the risk of re-hospitalisation and three times the risk of death than children hospitalised for diseases not related to housing, after adjusting for age, sex, ethnicity and deprivation.125
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A Stocktake of New Zealand’s Housing – February 2018
There are effective primary prevention housing projects. Children aged under 20 (predominantly Pacific and Māori) demonstrated statistically significant reductions in their total acute and arranged hospitalisation rates as a result of living in homes that participated in HNZC’s Healthy Housing Programme, which included a range of measures such as insulation and heating retrofits and measures to address household crowding.126 These benefits are often under-estimated.127
8.3 Quality of rental housing Although there is no large random sample of dwelling quality in New Zealand, there is consistent evidence that on average private rental dwellings – generally older stock – are in the worst condition, followed by state housing, which has had extensive retrofitting – with owner-occupied housing being in the best condition. Tenants consistently report that their home is in worse condition than owner-occupiers, for example twice as many renters than owner-occupiers reported that their homes had lower material living standards overall.128 These results showing poorer performance for rental housing are backed by independent assessors. The 2015 BRANZ House Condition Survey of 560 houses assessed 32% of rental properties as being ‘poorly maintained’ compared with 14% of owner-occupied housing; 56% of rental properties compared with 49% of properties overall showed visible signs of mould.129 Mould was observed less frequently in houses where insulation and ventilation were present and heating was used.130 In 1,831 assessments carried out by independent building assessors as part of HRC-funded housing research, significantly more respiratory and injury hazards were shown in rental properties than in owner-occupied homes (See Figures 8.2 and 8.3).131 132 133 Respiratory and injury hazards lead to more respiratory symptoms and ACC claims.134 135 This clear quality difference means that tenants, who are more likely to be on lower incomes, are exposed to more health and safety risks than owner-occupiers. Rental standards may be raised through the recently passed Healthy Homes Guarantee Act 2017 and a rental WOF, which is being trialled in a number of New Zealand cities and being evaluated to consider the effectiveness and cost benefit of this approach, led by councils in partnership with researchers.136
32% of rental properties are being ‘poorly maintained’ compared to 14% of owner-occupied properties
45
32%
A Stocktake of New Zealand’s Housing – February 2018
Mean number of injury hazards per dwelling
FIGURE 8.2: INJURY RISKS BY TENURE OF DWELLING137 7 6 5 4 3 2 1 0 HIPI/Non-rental
MIPI/Non-rental WTR/Non-rental
WTR/Rental
NM/Non-rental
NM/Rental
HCS/Non-rental
HCS/Rental
NM/Rental
HCS/Non-rental
HCS/Rental
Study and dwelling tenure
Mean number of respiratory hazards per dwelling
FIGURE 8.3: RESPIRATORY HAZARDS BY TENURE OF DWELLING138 4 3.5 3 2.5 2 1.5 1 0.5 0
HIPI/Non-rental
MIPI/Non-rental WTR/Non-rental
WTR/Rental
NM/Non-rental
Study and dwelling tenure
8.4 Leaky buildings Leaky new buildings were identified in the 1990s and 2000s and subsequently in the current building boom in Auckland and Christchurch.139 A 2009 government commissioned report by PricewaterhouseCoopers estimated that there were then between 22,000 and 89,000 leaky homes in New Zealand and the estimated consensus cost of damage in 2008 dollars was $11 billion, with the lower and upper bounds being $6 billion and $23 billion.140 The policy packages developed have left many important, unresolved building issues, so that relatively new owner-occupied properties, as well as older housing stock which has become rental housing stock, still leak and cause probable health costs.141 As of November 2017, MBIE reports that the Weathertight Homes Resolution Services (WHRS) has received in total 7,362 claims on 12,776 homes; 613 claims are still open on 3,645 homes. In the 2017/8 budget, the WHRS has a budget of $12.3 million and auxiliary payments of $3.5 million.142 Apart from the remediation costs involved, the poor quality of these buildings, even when remediated, has affected their ongoing value, as well as the general preferences of buyers, bankers and insurers.143
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A Stocktake of New Zealand’s Housing – February 2018
References 1
MSD reported that in the three months ending 30 Sept 2017 the total number of Emergency Housing SNGs granted declined by 20% over the previous quarter, however, this in part reflects the growth in the number of transitional housing places available. The number of new clients presenting to Work and Income with an emergency housing need remained relatively stable over the past 12 months with between 100-150 new clients receiving an EHSNG each week.
2
Recent house price growth has however tended to be in smaller cities and provincial towns. For example in 2016 prices in Auckland (4.3%) or Wellington (7.6%) have risen slower that in some regional towns (Marlborough 17.3%, Horowhenua 15.3%, Wanganui 15.1%, Queenstown-Lakes 13.7%, Rotorua 11.5%, Tasman 11.2%, Napier 10.2%, Nelson 10.2%. The overall price of housing in these smaller cities and towns, except for Queenstown-Lakes remains significantly less than in Auckland and Wellington however.
3
Controller and Auditor General (2011). Government planning and support for housing on Māori land. Wellington: Office of the Controller and Auditor General.
4
Controller and Auditor General (2014). Government planning and support for housing on Māori land Progress in responding to the Auditor-General’s recommendations. Wellington: Office of Controller and Auditor General.
5
Statistics New Zealand (2016). Changes in home-ownership patterns 1986–2013: Focus on Māori and Pacific people. Wellington: Statistics New Zealand.
6
See Residential Tenancy Act s24(1)(d),(e), and (g): http://www.legislation.govt.nz/act/public/1986/0120/52.0/ DLM95057.html
7
http://archive.stats.govt.nz/Census/2013-census/profile-and-summary-reports/quickstats-about-housing/homeownership-individuals.aspx
8
In census statistics, a household consists of one person usually residing alone, or two or more people usually residing together in a private dwelling, therefore visitors are excluded.
9
BRANZ. (2017) The New Zealand Rental Sector Report ER22. Wellington: BRANZ.
10 Stewart A. Bonds worth millions forfeited to Crown. The Dominion Post 10 July 2015:A8. 11
Source: Statistics New Zealand Dwelling and Household Estimates at https://www.stats.govt.nz/informationreleases/dwelling-and-household-estimates-september-2017-quarter.
12 Note: Technically these figures are where the dwelling is not owned, as renting only refers to households where they pay rents. 13 Source: Corelogic 14 http://archive.stats.govt.nz/browse_for_stats/people_and_communities/Households/household-economic-surveyinfo-releases.aspx 15 Over the decade 2008 to 2017 the average proportion of household income spent on housing in Auckland was 18.3% compared with 15.1% in provincial North Island and 13.6% in provincial South Island – see Table 1 in appendices for details 16 Source: Statistics New Zealand – Household Economic Survey – see also Perry, B. Household Incomes in New Zealand; Trends in indicators of inequality and hardship 1982 to 2016 17 Sources: Ministry of Business Innovation and Employment – Tenancy Bond’s database, Statistics New Zealand Quarterly Employment Survey and Consumer Price Index 18 This estimate is based on average weekly wages for employees reported in the Quarterly Employment Survey. 19 The 2015/16 Household Economic Survey reported on moving costs. Average annual expenditure for people who moved (includes renters and owners) was $2,601). 20 Source: Ministry of Business Innovation and Employment Tenancy Bond Division data base: http://www.mbie.govt. nz/info-services/housing-property/sector-information-and-statistics/rental-bond-data. 21 https://www.branz.co.nz/cms_show_download.php?id=606738ff7cb47451e094ad80f39cc912fa18f7a8 22 See Vote Building and Housing in Government’s Estimates & Appropriations 2017/18 p.8. 23 Source: New Zealand Year Books and Statistics New Zealand Dwelling and Household Estimates. 24 Source: http://nzdotstat.stats.govt.nz/wbos/Index.aspx?_ga=2.181434535.165777961.1516222762-1025093187.1510003368 25 Source: Customised data provided by Statistics New Zealand from 2001, 2006 and 2013 Censuses. See http:// nzdotstat.stats.govt.nz 26 Data source CoreLogic
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A Stocktake of New Zealand’s Housing – February 2018
27 Sources: Ministry of Business Innovation and Employment – Tenancy Bond’s database, Statistics New Zealand Quarterly Employment Survey 28 Massey University Real Estate Analysis Unit available at http://www.massey.ac.nz/massey/learning/colleges/collegebusiness/school-of-economics-and-finance/research/mureau/mureau_home.cfm 29 https://www.stats.govt.nz/news/new-zealands-net-wealth-passes-1-5-trillion 30 https://www.stats.govt.nz/news/top-10-percent-of-households-have-half-of-total-net-worth 31 Source: Statistics New Zealand Annual Balance Sheets 2016 (Provisional) 32 See for example Statistics New Zealand’s most recent subnational family and household projections at https://www. stats.govt.nz/news/empty-nesters-a-growing-part-of-the-flock. 33 Source: Statistics New Zealand Dwelling and Household Estimates at https://www.stats.govt.nz/informationreleases/dwelling-and-household-estimates-september-2017-quarter. 34 Source: Statistics New Zealand National Population Estimates and Dwelling and Household Estimates. 35 Source: Statistics New Zealand International Travel and Migration data set available at http://archive.stats.govt.nz/ infoshare/?url=/infoshare/. 36 Statistics New Zealand Building Consents series from the Infos database 37 Ministry of Business Innovation and Employment (2017) Briefing for the Incoming Minister of Housing and Urban Development; p.14. 38 These estimates are based on Statistics New Zealand’s Sub-National Population Estimates and Building Consents series. They assume that the ideal house building rate is the same as the average dwelling occupancy rate of three people per dwelling. 39 The average size of a house in New Zealand, based on floor area, is 149 square metres. This has generally increased over time, with houses built recently being over 50% larger than houses built in 1900. Based on the decade built, houses had an average floor area of just under 132 square metres in 1900, while houses built since 2010 are on average 205 square metres. QV notes that average sizes of new builds increased from 166.4 metres in 1990 to 205.3 square metres in 2010 onwards. Construction companies believe this is where the greatest demand is (and margins) https://www.qv.co.nz/property-insights-blog/average-house-size-by-age/62. See also http://www.mbie.govt.nz/ publications-research/research/construction-sector-productivity/national-construction-pipeline-report-2017.pdf Work by Viggers and colleagues has also shown that because of increasing house sizes, households in modern houses also use more energy than old state houses (Viggers, H., Keall, M., Wickens, K., Howden-Chapman, P. Increased house size cancels out the effect of improved insulation on overall heating energy requirements, Energy Policy, 2017, 107, 248-257). 40 Statistics New Zealand Producer Price Indices and Consumer Price Indices 41 See the Productivity Commission’s 2017 report Better Urban Planning at https://www.productivity.govt.nz/sites/ default/files/MASTER%20COMPILED%20Better%20urban%20planning%20with%20corrections%20May%202017.pdf 42 For an extended discussion of this shift see Howden-Chapman, P., Early, L., Ombler, J. (Eds) Cities in New Zealand: Preferences, patterns and possibilities Wellington, Steele Roberts Aotearoa, 2017. 43 For example, in 2015 there were 2,760 enterprises operating in the Land Development and Site Preparation Sector, but this appears to disguise the true extent of competition amongst developers as: a) the number of enterprises has been decreasing since 2000 (when the total no of enterprises was 3,546); b) 70% of enterprises have fewer than five employees; and c) only six enterprises employed more than 100 people. 44 For a short history of these failures see http://www.parliament.nz/resource/en-nz/49DBSCH_ SCR5335_1/0d9cfef1280ab5ba97f9569c8f965bfd7374305f and more recently https://www.interest.co.nz/saving/ deep-freeze-list 45 Statistics New Zealand Local Government Financial Statistics 46 Source: Auckland Council’s Annual Reports – 2010/11 to 2016/17 47 This is a definition adopted by UK housing charity Shelter’s. See http://england.shelter.org.uk/campaigns_/why_we_ campaign/Improving_social_housing/what_is_social_housing See also definitions in Howden-Chapman, P. Housing Standards: a glossary of housing and health. Journal of Epidemiology and Community Health, 2004, 58, 162-168. 48 Bierre S, Howden-Chapman P, Early L. (Eds) Homes People Can Afford. Wellington: Steele Roberts; 2013. 49 Source: Ministry of Social Development (2017) Social Housing Update – September 2017. Customised data supplied by Housing New Zealand. Johnson, A (2017) Taking Stock: The Demand for Social Housing in New Zealand. Table 3 p.9.
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A Stocktake of New Zealand’s Housing – February 2018
50 This figure includes a combination of tenants paying market rent because a quarter of their household income is higher than local market rents, houses funded through appropriations for Community Group Housing, and vacant Housing NZ stock 51 Source: Housing New Zealand Annual reports and data provided by Housing New Zealand. 52 Johnson, A (2017) 53 Source: Ministry of Social Development Social Housing Updates 54 This estimate is based on Treasury forecasts contained in the 2017 Budget Economic and Fiscal Update. 55 Source: Housing New Zealand Annual reports 56 Source: Treasury Budget Economic and Fiscal Update 2017 and Estimates of Appropriations 2017/18. The estimate for demand subsidies for emergency housing is based on Ministry of Social Development’s Benefit Factsheets and is from reports on supplementary benefits paid for the June 2017 and September 2017 quarters. 57 Ibid 58 Ministry of Social Development (2017) Social Housing Quarterly Report – June 2017. 59 Housing New Zealand Annual Report 2017 p.56. 60 See Schedule 18 of the Social Security Act 1964. 61 Johnson, A. (2013) Give Me Shelter: An assessment of New Zealand’s Housing Assistance Policies; p.54. 62 Current advice from Government agencies is that there is little evidence of landlord capture. See for example Treasury’s assessment at http://www.treasury.govt.nz/downloads/pdfs/b17-info/b17-3664879.pdf, http://www.msd. govt.nz/documents/about-msd-and-our-work/work-programmes/family-incomes-package/10-march-aide-memoirerisk-of-landlord-capture-from-increases-to-the-accommodati....pdf 63 From customised data supplied by Ministry of Social Development 64 Treasury (2017) Budget Economic and Fiscal Update 2017 and Estimates of Appropriations 2017/18, p.124 65 From customised data supplied by Ministry of Social Development 66 Housing New Zealand Financial Products Quarterly Reports 67 From customised data supplied by Ministry of Social Development 68 Source: Treasury (2017) Budget Economic and Fiscal Update 2017 and Estimates of Appropriations 2017/18. 69 Amore K. (2016) Severe housing deprivation in Aotearoa/New Zealand. He Kainga Oranga/Housing & Health Research Programme, University of Otago, Wellington 70 Ministry of Business Innovation and Employment (2017). Briefing for the Incoming Minister of Housing & Urban Development 25 October. Wellington: MBIE. 71 Special data collection following the method used in the 2013 Census carried out by Drs Kate Amore and Christina Severinsen. 72 Customised data provided by Ministry of Social Development 73 These figures are for households on the social housing waiting list and do not include social housing tenants seeking a transfer of their tenancy. 74 Source: Data supplied by Ministry of Social Development. (Number of household on social housing register who were identified as being in insecure housing (Priority A) grew 90%) 75 Customised data provided by Ministry of Social Development 76 See Tsemberis, Sam, Housing First: The Pathways Model to End Homelessness for People with Mental Illness and Addiction, Hazelden, 2010 and Pleace, N & Bretherton, J, “The Case for Housing First in the European Union: A Critical Evaluation of Concerns about Effectiveness” in European Journal of Homelessness, 2:7, 2013. 77 Note that there was a large undercount of housing New Zealand properties in 2006 and 2013. See 2013 Census information by variable. Available from www.stats.govt.nz 78 Desmond M. (2012) Eviction and the reproduction of urban poverty. American Journal of Sociology 2012;118(1):88-133 79 Fowler KA, Gladden RM, Vagi KJ, Barnes J, Frazier L. (2015) Increase in suicides associated with home eviction and foreclosure during the US Housing Crisis. American Journal of Public Health 2015;105 (2):311-16. 80 Source: https://www.msd.govt.nz/about-msd-and-our-work/work-programmes/housing/initiatives/better-housingoutcomes-sustaining-tenancies.html 81 Source: https://www.ahuri.edu.au/research/final-reports/259
49
A Stocktake of New Zealand’s Housing – February 2018
82 Ministry of Business Innovation and Employment (2017). Briefing for the Incoming Minister of Housing & Urban Development 25 October. Wellington: MBIE. 83 Source: https://www.branz.co.nz/cms_show_download.php?id=606738ff7cb47451e094ad80f39cc912fa18f7a8 84 Source: https://www.branz.co.nz/cms_show_download.php?id=606738ff7cb47451e094ad80f39cc912fa18f7a8 85 Statistics New Zealand. QuickStats About Population Mobility: 2006 Census. 86 Morton SMB, Atatoa Carr PE, Berry SD, Grant CC, Bandara DK, Mohal J, et al. (2014) Growing Up in New Zealand: A longitudinal study of New Zealand children and their families. Residential Mobility Report 1: Moving house in the first 1000 days. Auckland: Growing Up in New Zealand. 87 Sligo J, McAnally H, Tansley J, Baxter J, Bolton A, Skillander K, et al. (2017) The dynamic, complex and diverse living and care arrangements of young New Zealanders: implications for policy. Kōtuitui: New Zealand Journal of Social Sciences Online. 12(1):41-55, DOI: 10.1080/1177083X.2016.96715 88 Jatrana S, Richardson K, Crampton P. (2013) The association of residential mobility with affiliation to primary care providers. New Zealand Population Review 2013;39:101-20 89 Gilbert J. (2005) Educational Issues for Communities Affected by Transience and Residential Mobility: Report on Phase 1 (2003-2004). Wellington: New Zealand Council for Educational Research. 90 Customised data from Ministry of Business, Innovation and Employment analysis of IDI data. September 2017 91 Statistics New Zealand (2016). Changes in home-ownership patterns 1986–2013: Focus on Māori and Pacific people. 92 Statistics New Zealand – 2013 Census 93 Hutchings HA, Evans A, Barnes P, Demmler JC, Heaven M, Healy MA, et al.(2016) Residential Moving and Preventable Hospitalizations. Pediatrics. 2016;138. 94 Oliver J, Foster T, Kvalsvig A, Williamson DA, Baker MG, Pierse N. (2017) Risk of rehospitalisation and death for vulnerable New Zealand children. Archives of Diseases in Childhood: doi: 10.1136/archdischild-2017-312671. 95 Perry B. Household incomes in New Zealand: Trends in indicators of inequality and hardship 1982 to 2016. Wellington: Ministry of Social Development; 2017. 96 Saville-Smith K, Jackson N. (2017). 97 Source: http://archive.stats.govt.nz/Census/2013-census/profile-and-summary-reports/quickstats-65-plus.aspx 98 Baker M, Keall M, Lyn Au E, Howden-Chapman P. (2007) Home is where the heart is – most of the time. New Zealand Medical Journal. 2007;120:1264. 99 Telfar-Barnard L. (2015) Report of the systematic review on indoor cold for the WHO Housing and Health Guidelines. Geneva: World Health Organization. 100 OECD. (2017) OECD Environmental Performance Reviews: New Zealand 2017. Paris: OECD. 101 Telfar-Barnard L. (2015) Report of the systematic review on insulation against cold for the WHO Housing and Health Guidelines. Geneva: World Health Organization. 102 White V, Jones M. (2017) Warm, dry, healthy? Insights from the 2015 House Condition Survey on insulation, ventilation, heating and mould in New Zealand houses. Judgeford: BRANZ. 103 White V, Jones M. (2017) Warm, dry, healthy? Insights from the 2015 House Condition Survey on insulation, ventilation, heating and mould in New Zealand houses. Judgeford: BRANZ. 104 Free S, Howden-Chapman P, Pierse N, Viggers H, (2010) Housing Heating and Health Study Research Team Study Team. Does more effective home heating reduce school absences for children with asthma? Journal of Epidemiology and Community Health. 2010; 64:379-86 105 Howden-Chapman P, Viggers H, Chapman R, O’Dea D, Free S, O’Sullivan K. (2009) Warm homes: drivers of the demand for heating in the residential sector in New Zealand. Energy Policy. 2009;37(9):3387-99 106 Howden-Chapman P, Viggers H, Chapman R, O’Sullivan K, Telfar Barnard L, Lloyd B. (2012) Tackling cold housing and fuel poverty in New Zealand: A review of policies, research, and health impacts. Energy Policy. 2012;49:134–42 107 Statistics New Zealand (2017). Investigating different measures of energy hardship in New Zealand. Wellington: Statistics NZ; 2017 108 Shorter C, Crane J, Pierse N, Barnes P, Kang J, Wickens K, et al. (2017) Indoor visible mold and mold odour are associated with new-onset childhood wheeze in a dose dependent manner. Indoor Air. 2017;Aug 4(doi: 10.1111/ ina.12413.). 109 See Howden-Chapman, P., Roebbel, N., Chisholm, E. Setting housing standards to improve global health, International Journal of Environmental Research and Public Health, 2017, 4.
50
A Stocktake of New Zealand’s Housing – February 2018
110 Plagmann M, White V, McDowall P. (2017) Indoor Climate in New Zealand Homes: Draft report. Judgeford: BRANZ. 111 White V, Jones M. (2017) Warm, dry, healthy? Insights from the 2015 House Condition Survey on insulation, ventilation, heating and mould in New Zealand houses. Judgeford: BRANZ. 112 Ibid 113 Preval N. (2015) Statistical and policy evaluation of large-scale public health interventions. Dunedin: University of Otago. 114 Preval N, Keall M, Telfar-Barnard L, Grimes A, Howden-Chapman P. (2017) Impact of improved insulation and heating on mortality risk of older cohort members with prior cardiovascular or respiratory hospitalisations. BMJ open. 2017;7(11):e018079. 115 Telfar Barnard L, Preval N, Howden-Chapman P, Arnold R, Young C, Grimes A, et al. (2011) The impact of retrofitted insulation and new heaters on health services utilisation and costs, pharmaceutical costs and mortality: Evaluation of Warm Up New Zealand: Heat Smart. 116 OECD. (2017) OECD Environmental Performance Reviews: New Zealand 2017. Paris: OECD. 117 Howden-Chapman P, Pierse N, Nicholls S, Gillespie-Bennett J, Viggers H, Cunningham M, et al. (2008) Effects of improved home heating on asthma in community dwelling children: randomised community study. British Medical Journal. 2008;337:852-5. 118 Free S, Howden-Chapman P, Pierse N, Viggers H, (2010) Housing Heating and Health Study Research Team Study Team. Does more effective home heating reduce school absences for children with asthma? Journal of Epidemiology and Community Health. 2010; 64:379-86. 119 Note: There has been a slight decrease in occupancy rate in severely crowded households from 7.1 people per household to 7 people, but the rate of crowded households, where one more bedroom is needed to prevent crowding, has stayed the same at 4.8 people. https://www.health.govt.nz/publication/analysis-household-crowdingbased-census-2013-data. 120 Statistics New Zealand. (2014) Analysis of Household Crowding Based on Census 2013 data. Wellington: Statistics New Zealand. 121 Baker M, Telfar Barnard L, Kvalsvig A, Verrall A, Zhang J, Keall M, et al. (2012) Increasing incidence of serious infectious diseases and inequalities in New Zealand: a national epidemiological study. The Lancet. 2012;379:1112-19 122 Baker M, Das D, Venugopal K, Howden-Chapman P. (2008) Tuberculosis associated with household crowding in a developed country. Journal of Epidemiology and Community Health. 2008;62:715-21. 123 Baker MG, McDonald A, Zhang J, Howden-Chapman P. (2013) Infectious Diseases Attributable to Household Crowding in New Zealand: A Systematic Review and Burden of Disease Estimate. Wellington: He Kainga Oranga / Housing and Health Research Programme, University of Otago, Wellington. 124 Telfar Barnard L, Zhang J. (2017) The Impact of Respiratory Disease in New Zealand: 2016 update Auckland: Asthma and Respiratory Foundation NZ. 125 Oliver J, Foster T, Kvalsvig A, Williamson DA, Baker MG, Pierse N. (2017) Risk of rehospitalisation and death for vulnerable New Zealand children. Archives of Diseases in Childhood;doi: 10.1136/archdischild-2017-312671 126 Baker M, Zhang J, Keall M, Howden-Chapman P. (2011) Health Impacts of the Healthy Housing Programme on Housing New Zealand Tenants: 2004-2008. Wellington: He Kainga Oranga/Housing and Health Research Programme, University of Otago. 127 Howden-Chapman, P., Chapman, R., Baker, M.G. (2013) Invited editorial: Valuing social housing needs to take a broader view, Journal of Epidemiology and Community Health, 2013, 67, 10, 803-804. 128 Statistics New Zealand (2015). Perceptions of housing quality in 2014/15. Wellington: Statistics New Zealand. 129 White V, Jones M, Cowan V, Chun S. (2017) BRANZ 2015 House Condition Survey: Comparison of house condition by tenure SR370. Judgeford: BRANZ. 130 White V, Jones M. (2017). 131 Keall MD, Crane J, Baker MG, Wickens K, Howden-Chapman P, Cunningham M. (2012) A measure for quantifying the impact of housing quality on respiratory health: a cross-sectional study. Environmental Health 2012;11. 132 Keall M, Baker M, Howden-Chapman P, Cunningham C. (2008) Association between the number of home injury hazards and home injury. Accident Analysis and Prevention. 2008;40 (3):887-93. 133 Keall MD, Howden-Chapman P, Baker MG, Kamalesh V, Cunningham M, Cunningham C, et al. (2013) Formulating a programme of repairs to structural home injury hazards in New Zealand. Accident Analysis & Prevention. 2013;57(0):124-30.
51
A Stocktake of New Zealand’s Housing – February 2018
134 Keall MD, Guria J, Howden-Chapman P, Baker MG. (2011) Estimation of the social costs of home injury: a comparison with estimates for road injury Accident Analysis and Prevention. 2011;43(3):998-1002. 135 Keall M, Pierse N, Howden-Chapman P, Guria J, Cunningham C, Baker M. (2014) Reduction in fall injury rates achieved by home modification: a cluster randomised controlled trial. The Lancet. 2014;284(9949):1159-236. 136 Telfar-Barnard L, Bennett J, Howden-Chapman P, Jacobs DE, Ormandy D, Cutler-Welsh M, et al. (2017) Measuring the Effect of Housing Quality Interventions: The Case of the New Zealand “Rental Warrant of Fitness”. International Journal of Environmental Research and Public Health. 2017;4. 137 Sources: HIPI: Keall MD, Pierse N, Howden-Chapman P. et al Home modifications to reduce injuries from falls in the Home Injury Prevention Intervention (HIPI) study: a cluster-randomised controlled trial. The Lancet 2015; 385: 231–38. MHIPI: https://www.anzctr.org.au/Trial/Registration/TrialReview.aspx?id=363525&isReview=true Whiti Te Ra WTR: http://www.otago.ac.nz/news/news/otago020889.pdf Te Hoe Nuku Roa NR: http://www.massey.ac.nz/~wwpubafs/2004/Massey_News/feb/feb23/stories/11-02-04.html HCS: Buckett NR, Jones MS, Marston NJ. BRANZ 2010 House Condition Survey: condition comparison by tenure: BRANZ; 2011. 138 Ibid 139 Howden-Chapman P, Ruthe C, Crichton S. (2011) Habitable houses: lessons learned? The Leaky Building Crisis: Understanding the issues. Wellington: Thomson Reuters; 2011. p. 303-15. 140 Department of Building and Housing (2009). Weathertightness – Estimating the Cost. July 2009. 141 Douwes J, Howden-Chapman P. (2011) An overview of possible health effects from exposure to “leaky buildings”. The Leaky Building Crisis: Understanding the issues. Wellington: Thomson Reuters; 2011. p. 71-84. 142 Ministry of Business Innovation and Employment (2017). Briefing for the Incoming Minister of Housing & Urban Development 25 October. Wellington: MBIE. 143 Shi S, McCarthy I, Mai U.(2017) Leaky building stigma: Can it be eliminated by remediation? Evidence from New Zealand. International Journal of Housing Markets and Analysis. 2017;10(3):328-51. https://doi.org/10.1108/ IJHMA-06-2016-0043
52
A Stocktake of New Zealand’s Housing – February 2018
Appendices Table 1: Estimates of households and dwellings by tenure – 2007 to 2017 SOURCE: Statistics New Zealand Estimates of Dwellings and Households
Rented dwellings
Dwellings provided rent free
Total dwellings not owned by occupants
1,106,400
491,000
69,200
560,200
1,688,000
1,115,500
503,700
68,800
572,500
1,702,200
1,119,800
514,300
68,100
582,400
558,300
1,715,600
1,123,500
524,800
67,400
592,200
566,900
1,728,400
1,126,600
535,200
66,600
601,800
61,900
575,600
1,741,200
1,129,700
545,700
65,800
611,500
61,900
586,100
1,756,400
1,133,100
557,400
65,800
623,200
536,300
62,500
598,800
1,776,000
1,138,500
571,000
66,500
637,500
549,100
63,200
612,300
1,797,900
1,145,100
585,400
67,400
652,800
1,080,100
562,800
63,900
626,700
1,822,200
1,153,100
600,800
68,300
669,100
1,087,200
577,400
64,800
642,200
1,849,000
1,162,400
617,300
69,300
686,600
40,800
113,000
-600
112,400
182,500
56,000
126,300
100
126,400
Total households
Owneroccupier households
Households renting
Households with rent free accommodation
Total households not owning
Total dwellings
Owneroccupied dwellings
2007
1,576,200
1,046,400
464,400
65,400
529,800
1,666,500
2008 2009
1,590,400
1,052,300
473,000
1,604,000
1,056,400
483,100
65,100
538,100
64,500
547,600
2010
1,617,400
1,059,100
2011
1,628,200
1,061,300
494,800
63,500
504,200
62,700
2012
1,638,900
2013
1,651,600
1,063,300
513,700
1,065,600
524,200
2014 2015
1,668,100
1,069,300
1,686,400
1,074,100
2016
1,706,800
2017
1,729,300 153,100
At September
Change 2007-17
53
A Stocktake of New Zealand’s Housing – February 2018
Table 2: Regional tenure patterns and estimates of rental housing stock – 2013 to 2017 SOURCE: Statistics New Zealand – 2013 Census, Estimates of Dwellings and Households and Building Consents data Total housing stock 2013
% of dwellings not owned
Northland Region
73,926
33.8%
24,961
Auckland Region
506,808
38.5%
195,364
Waikato Region
182,010
37.3%
67,962
Bay of Plenty Region
116,973
35.3%
41,235
Gisborne Region
18,009
40.8%
7,349
Hawke's Bay Region
64,278
34.1%
21,907
Taranaki Region
47,283
32.0%
Manawatu-Wanganui Region
99,510
34.8%
Wellington Region
Estimate of rental housing stock June 2017
% of dwellings rented in June 2017
76,900
27,400
35.6%
535,000
216,700
40.5%
191,500
74,900
39.1%
123,200
45,600
37.0%
18,300
7,800
42.6%
65,600
23,600
36.0%
15,142
48,900
16,600
33.9%
34,592
101,600
37,100
36.5%
Stock not owned by occupants
Estimate of stock June 2017
192,894
35.1%
67,671
198,600
73,200
36.9%
Tasman Region
21,582
25.0%
5,400
22,700
6,100
26.9%
Nelson Region
20,223
31.6%
6,398
20,900
7,000
33.5%
Marlborough Region
22,155
29.1%
6,439
22,900
7,100
31.0%
West Coast Region
16,599
31.9%
5,295
17,000
5,700
33.5%
Canterbury Region
236,463
31.7%
75,074
256,700
86,000
33.5%
Otago Region
94,266
32.0%
30,158
99,200
33,500
33.8%
Southland Region
42,828
30.3%
12,989
43,600
14,000
32.1%
1,756,140
35.2%
619,022
1,842,900
682,400
37.0%
Total New Zealand
54
A Stocktake of New Zealand’s Housing – February 2018
Table 3: Yields on residential rental property investment by region – 2017 Ashburton District Auckland Buller District Carterton District Central Hawkes Bay District Central Otago District Christchurch City Clutha District Dunedin City Far North District Gisborne District Gore District Grey District Hamilton City Hastings District Hauraki District Horowhenua District Hurunui District Lower Hutt City Invercargill City Kaikoura District Kaipara District Kapiti Coast District Kawerau District Mackenzie District Mawatu District Marlborough District Masterton District Matamata-Piako District Nelson City New Plymouth District Opotiki District Otorohanga District
55
1997
2007
2017
7.4 6.9 9.5 7.0 9.2 6.9 6.5 9.2 8.2 7.7 7.0 8.3 8.1 6.5 6.8 7.1 9.1 6.9 7.7 8.7 6.2 6.5 7.8 10.8 8.4 7.7 6.4 7.3 6.1 6.5 7.6 7.5 9.8
4.6 4.6 5.6 4.0 4.8 4.7 4.5 4.9 5.5 4.1 4.7 5.2 5.4 4.4 4.7 4.2 4.7 4.3 4.5 5.2 3.5 4.5 4.4 6.4 4.5 4.7 4.5 4.4 4.3 4.9 4.8 3.9 4.2
4.9 3.3 5.6 4.2 4.9 4.2 4.4 6.1 5.4 4.0 5.3 5.6 5.5 3.7 4.6 4.1 5.1 4.1 4.4 5.4 4.8 3.5 4.0 6.0 4.2 4.8 4.3 4.9 4.0 3.8 4.4 5.0 4.8
Palmerston North City Porirua City Queenstown-Lakes District Rangitikei District Rotorua District Ruapehu District Selwyn District South Taraki District South Waikato District South Wairarapa District Southland District Stratford District Tararua District Tasman District Taupo District Tauranga District Thames-Coromandel District Timaru District Upper Hutt City Waikato District Waimakariri District Waimate District Waipa District Wairoa District Waitaki District Waitomo District Wellington City Western Bay Of Plenty District Westland District Whakatane District Whangarei District Wanganui District New Zealand - overall
1997
2007
2017
7.4 7.6 5.3 8.4 7.1 9.6 7.1 8.0 9.1 7.9 7.6 7.4 7.6 6.2 6.5 6.4 5.3 7.2 7.8 5.8 6.6 6.9 6.1 7.2 8.1 8.3 6.8 5.2 8.6 5.7 10.5 4.9 6.6
4.5 4.8 3.9 4.9 4.7 5.4 5.4 5.6 5.8 3.8 4.6 4.7 5.4 4.0 4.0 4.2 3.0 4.7 4.1 4.0 4.8 4.7 4.4 5.3 4.9 5.0 4.2 3.3 5.2 4.1 7.4 3.2 4.8
4.7 4.3 3.3 5.8 4.7 5.7 4.2 6.0 6.2 4.5 4.7 4.8 5.7 3.5 4.2 3.7 3.1 4.6 4.3 3.3 4.3 6.0 3.8 6.6 5.2 5.0 3.8 3.2 4.5 4.1 9.2 2.8 4.6
A Stocktake of New Zealand’s Housing – February 2018
Table 4: Regional household incomes and housing costs – 2008 to 2017 SOURCE: Statistics New Zealand – Household Economic Survey June years
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Auckland
15,372
14,569
16,107
17,856
16,751
17,743
18,643
19,981
22,649
21,335
Wellington
14,765
14,246
13,561
14,373
14,751
14,640
16,020
14,806
15,363
17,023
9,122
10,566
8,991
10,020
10,819
10,176
11,833
12,043
13,512
13,059
11,384
10,860
10,427
10,812
10,550
11,201
12,757
14,656
14,262
13,683
9,150
9,014
8,850
9,491
9,853
9,527
9,805
10,027
12,255
11,696
11,967
12,052
11,837
12,928
12,916
13,045
14,277
14,921
16,533
16,037
Average annual housing costs
Rest of the North Island Canterbury Rest of the South Island Total New Zealand Average annual household income
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Auckland
87,647
88,534
84,892
91,925
94,202
96,755
103,326
106,453
114,534
121,126
Wellington
90,475
91,424
92,728
98,586
93,877
105,278
97,402
102,817
98,860
113,701
Rest of the North Island
64,554
68,322
66,102
68,285
67,406
72,322
72,300
81,780
83,788
81,572
Canterbury
66,186
76,318
77,990
72,533
83,564
85,366
90,112
94,048
91,917
88,935
Rest of the South Island
66,003
69,247
70,487
70,719
71,615
76,430
83,903
82,586
77,232
75,422
Total New Zealand
74,882
78,254
76,928
79,720
81,170
85,678
88,339
93,482
95,408
97,882
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Auckland
17.5%
16.5%
19.0%
19.4%
17.8%
18.3%
18.0%
18.8%
19.8%
17.6%
Wellington
16.3%
15.6%
14.6%
14.6%
15.7%
13.9%
16.4%
14.4%
15.5%
15.0%
Rest of the North Island
14.1%
15.5%
13.6%
14.7%
16.1%
14.1%
16.4%
14.7%
16.1%
16.0%
Canterbury
17.2%
14.2%
13.4%
14.9%
12.6%
13.1%
14.2%
15.6%
15.5%
15.4%
Rest of the South Island
13.9%
13.0%
12.6%
13.4%
13.8%
12.5%
11.7%
12.1%
15.9%
15.5%
Total New Zealand
16.0%
15.4%
15.4%
16.2%
15.9%
15.2%
16.2%
16.0%
17.3%
16.4%
Proportion of household income spent on housing
56
A Stocktake of New Zealand’s Housing – February 2018
Table 5: Proportion of households spending above income to housing cost threshold – 2008 to 2017 SOURCE: Statistics New Zealand – Household Economic Survey June years
2008
2009
2011
2012
2013
2014
2015
2016
2017
222.8
204.3
196.8
204.1
200.7
213.9
218.7
256.8
253.8
20.9
18.9
18.4
19.1
18.4
19.8
20.1
22.5
21.5
159.9
136.8
134.8
133.5
130.5
151.0
154.9
175.6
178.4
15.0
12.7
12.6
12.5
11.9
13.9
14.3
15.4
15.1
91.9
68.2
74.2
71.6
61.0
85.3
82.3
98.9
92.2
8.6
6.3
6.9
6.7
5.6
7.9
7.6
8.7
7.8
258.7
232.1
290.9
285.5
275.8
253.9
282.7
271.8
310.0
49.3
43.9
51.2
48.8
48.3
44.4
48.3
49.3
47.1
198.8
174.7
221.8
214.8
202.7
191.9
214.5
204.0
231.7
37.9
33.0
39.1
36.7
35.5
33.6
36.7
37.0
35.2
115.2
102.1
130.2
132.2
131.8
119.6
134.1
127.4
137.1
22.0
19.3
22.9
22.6
23.1
20.9
22.9
23.1
20.8
481.5
436.4
487.7
489.5
476.5
467.8
501.5
528.5
563.7
30.2
27.1
29.8
29.6
28.6
28.3
30.0
31.3
30.6
358.7
311.4
356.7
348.1
333.2
342.9
369.4
379.6
410.1
22.5
19.4
21.8
21.1
20.0
20.7
22.1
22.5
22.3
207.1
170.2
204.4
203.9
192.8
204.9
216.4
226.3
229.3
13.0
10.6
12.5
12.1
11.6
12.4
12.9
13.4
12.5
Owner-occupied households More than 25% of household income on housing costs Number of households Percentage of all owner-occupied households More than 30% of household income on housing costs Number of households Percentage of all owner-occupied households More than 40% of household income on housing costs Number of households Percentage of all owner-occupied households Housing is not owned by household More than 25% of household income on housing costs Number of households Percentage of all households where house is not owned More than 30% of household income on housing costs Number of households Percentage of all households where house is not owned More than 40% of household income on housing costs Number of households Percentage of all households where house is not owned Total of all households More than 25% of household income on housing costs Number of households Percentage of all households More than 30% of household income on housing costs Number of households Percentage of all households More than 40% of household income on housing costs Number of households Percentage of all households
57
A Stocktake of New Zealand’s Housing – February 2018
Table 6: Comparison of rents, consumer prices and wages – 2007 to 2017 SOURCES: Ministry of Business Innovation and Employment – Tenancy Bond Division data base, Statistics New Zealand Consumer Price Index and Quarterly Employment Survey
Lower quartile rent
Geometric mean rent
CPI All Groups
Average weekly wage for employees – all sectors
Sep-07
208
275
1,025
741
Dec-07
213
281
1,037
752
Mar-08
215
287
1,044
776
Jun-08
217
288
1,061
774
Sep-08
220
289
1,077
783
Dec-08
220
289
1,072
792
Mar-09
222
292
1,075
815
Jun-09
221
290
1,081
808
Sep-09
219
288
1,095
810
Dec-09
221
291
1,093
810
Mar-10
222
295
1,097
818
Jun-10
224
296
1,099
818
Sep-10
226
297
1,111
824
Dec-10
227
300
1,137
839
Mar-11
232
307
1,146
851
Jun-11
233
307
1,157
855
Sep-11
232
306
1,162
860
Dec-11
232
307
1,158
864
Mar-12
238
317
1,164
882
Jun-12
240
318
1,168
885
Sep-12
241
318
1,171
888
Dec-12
244
323
1,169
893
Mar-13
246
329
1,174
907
Jun-13
248
330
1,176
903
Sep-13
247
328
1,187
916
Dec-13
252
335
1,188
920
Mar-14
256
343
1,192
937
Jun-14
257
342
1,195
934
Sep-14
255
341
1,199
934
Dec-14
260
347
1,197
944
Mar-15
266
358
1,193
959
Jun-15
269
359
1,200
962
Sep-15
268
358
1,204
963
Dec-15
273
365
1,198
973
Mar-16
276
373
1,200
977
Jun-16
280
374
1,205
979
Sep-16
280
374
1,209
982
Dec-16
289
385
1,214
987
Mar-17
288
390
1,226
999
Jun-17
292
392
1,226
1,000
Sep-17
293
392
1,232
1,011
58
A Stocktake of New Zealand’s Housing – February 2018
Table 7: Changes in mean rents on three bedroom houses for selected suburbs – 2012 to 2017 SOURCE: Ministry of Business Innovation and Employment – Tenancy Bond Division data base 4 Q average to Sep-12
4 Q average to Sep-16
4 Q average to Sep-17
1 year change
5 year change
Kaikohe
224
258
273
5.8%
22.3%
Glenfield Central
448
536
558
4.2%
24.6%
Ranui North
361
444
468
5.2%
29.5%
Akarana
457
543
559
2.8%
22.2%
Avondale West
418
504
541
7.5%
29.6%
Mt Wellington North
452
518
568
9.7%
25.6%
Otahuhu East
392
475
498
4.7%
27.1%
Manurewa Central
361
476
504
5.9%
39.5%
Papakura East
345
439
458
4.4%
33.0%
Huntly East
235
301
317
5.4%
34.9%
Claudelands - Hamilton
322
372
404
8.7%
25.7%
Greerton - Tauranga
319
378
415
10.0%
30.1%
Fordlands - Rotorua
207
237
282
18.8%
36.0%
Tokoroa
159
191
216
13.4%
35.6%
Flaxmere East
274
317
338
6.8%
23.6%
Westown – New Plymouth
335
369
377
2.2%
12.6%
Highbury – Palmerston North
263
290
315
8.4%
19.7%
Cannons Creek North
258
290
322
11.0%
24.7%
Trentham North
334
373
416
11.5%
24.6%
Naenae South
338
356
400
12.4%
18.5%
Miramar South
474
514
596
15.9%
25.9%
Tahunanui - Nelson
344
364
397
9.2%
15.7%
Aranui
309
377
367
-2.8%
18.6%
Hornby South
341
413
409
-1.0%
19.9%
Woolston West
330
398
376
-5.6%
13.9%
St Kilda West - Dunedin
313
352
386
9.5%
23.1%
Richmond - Invercargill
246
260
278
7.0%
12.9%
National
349
415
438
5.5%
25.5%
59
A Stocktake of New Zealand’s Housing – February 2018
Table 8: Estimates of tenancy turnover – 2007 to 2017 SOURCE: Ministry of Business Innovation and Employment – Tenancy Bond Division data base Active bonds
Bonds lodged
Turnover – lodge/active
Sep-07
268,183
48,179
18.0%
Dec-07
269,819
40,608
15.1%
Mar-08
270,816
42,356
15.6%
Jun-08
278,260
49,963
18.0%
Sep-08
282,567
43,536
15.4%
Dec-08
286,476
43,400
15.1%
Mar-09
287,676
47,354
16.5%
Jun-09
297,051
50,262
16.9%
Sep-09
303,062
44,905
14.8%
Dec-09
304,032
40,867
13.4%
Mar-10
303,461
48,561
16.0%
Jun-10
309,857
43,636
14.1%
Sep-10
314,702
46,612
14.8%
Dec-10
319,675
43,647
13.7%
Mar-11
319,664
47,041
14.7%
Jun-11
324,018
43,298
13.4%
Sep-11
330,416
47,577
14.4%
Dec-11
331,808
35,786
10.8%
Mar-12
328,902
45,902
14.0%
Jun-12
333,978
45,246
13.5%
Sep-12
338,995
46,854
13.8%
Dec-12
339,232
36,823
10.9%
Mar-13
336,371
44,688
13.3%
Jun-13
339,659
45,831
13.5%
Sep-13
341,358
40,607
11.9%
Dec-13
344,195
43,121
12.5%
Mar-14
344,918
46,069
13.4%
Jun-14
348,366
40,906
11.7%
Sep-14
354,395
44,737
12.6%
Dec-14
356,879
36,440
10.2%
Mar-15
356,138
46,390
13.0%
Jun-15
361,576
44,924
12.4%
Sep-15
366,311
41,810
11.4%
Dec-15
367,407
40,031
10.9%
Mar-16
366,523
46,877
12.8%
Jun-16
372,779
45,016
12.1%
Sep-16
379,027
47,543
12.5%
Dec-16
383,191
36,394
9.5%
Mar-17
379,151
45,650
12.0%
Jun-17
384,561
43,341
11.3%
Sep-17
386,816
38,056
9.8%
60
A Stocktake of New Zealand’s Housing – February 2018
Figure 9: Homeownership rates by age – 2001 to 2013 SOURCE: Customised data provided by Statistics New Zealand from the 2001, 2006 and 2013 Censuses Census
20-24
25-29
30-34
35-39
40-44
45-49
50-54
55-59
60-64
65-69
70-74
75-79
80-84
85+
2001
6%
26%
48%
61%
69%
74%
78%
79%
79%
80%
81%
79%
73%
55%
2006
7%
23%
44%
57%
65%
70%
75%
78%
79%
79%
79%
78%
74%
59%
2013
5%
18%
36%
50%
58%
64%
68%
72%
75%
77%
77%
76%
73%
60%
Figure 10: Home ownership rates by region – 2013 SOURCE: Statistics New Zealand 2013 Census Owned or partly owned
Not owned
Owned by family trust
Total households stated
Not stated
Composite % owned
Northland
27,858
18,066
7,581
53,505
5,439
66.2%
Auckland
201,411
168,708
67,533
437,649
31,848
61.5%
Waikato
68,193
52,536
19,974
140,706
9,468
62.7%
Bay of Plenty
45,456
33,453
15,984
94,890
7,383
64.7%
Gisborne
7,083
6,006
1,629
14,718
1,278
59.2%
Hawke's
26,919
18,417
8,703
54,039
3,603
65.9%
Taranaki
21,084
12,951
6,405
40,440
2,571
68.0%
Manawatu-Wanganui
42,228
28,401
11,067
81,693
5,307
65.2%
Wellington
86,346
58,515
21,933
166,794
9,339
64.9%
Tasman
10,194
4,356
2,850
17,397
864
75.0%
Nelson
9,651
5,598
2,445
17,694
849
68.4%
Marlborough
9,252
4,863
2,610
16,722
951
70.9%
West Coast
7,179
3,885
1,116
12,180
1,107
68.1%
Canterbury
106,314
61,671
26,262
194,247
10,593
68.3%
37,221
23,841
13,458
74,520
4,392
68.0%
Otago Southland All New Zealand
61
18,963
10,743
5,709
35,412
2,034
69.7%
725,448
512,109
215,280
1,452,840
97,053
64.8%
A Stocktake of New Zealand’s Housing – February 2018
Figure 11: New lending on mortgages by type of borrower – 2014 to 2017 - $millions SOURCE: Reserve Bank of New Zealand Series C31 New residential mortgage lending by borrower type.
Investors
Business lending
First home buyers as %
Owneroccupiers as %
Investors as %
9,087
4,586
233
10%
59%
30%
1,413
8,263
4,637
195
10%
57%
32%
1,729
9,942
5,677
215
10%
57%
32%
18,450
1,955
10,051
6,230
215
11%
54%
34%
18,269
2,117
10,483
5,476
191
12%
57%
30%
Mar-16
15,855
1,803
8,782
5,068
203
11%
55%
32%
Jun-16
20,594
2,360
10,968
7,039
228
11%
53%
34%
Sep-16
18,243
2,167
10,492
5,384
199
12%
58%
30%
Dec-16
17,564
2,478
10,765
4,150
172
14%
61%
24%
Mar-17
13,897
1,872
8,559
3,293
172
13%
62%
24%
Jun-17
15,691
2,192
9,467
3,852
179
14%
60%
25%
Sep-17
14,474
2,097
8,976
3,235
165
14%
62%
22%
Quarter
Total lending
First home buyer
Owneroccupiers
Dec-14
15,524
1,617
Mar-15
14,507
Jun-15
17,564
Sep-15 Dec-15
62
A Stocktake of New Zealand’s Housing – February 2018
Table 12: Region house prices changes – 2007 to 2017 - $s nominal SOURCE: Corelogic Jun-07
Jun-08
Jun-09
Jun-10
Jun-11
Jun-12
Jun-13
Jun-14
Jun-15
Jun-16
Jun-17
Auckland
330,000
340,000
340,000
347,625
357,000
365,000
392,000
452,500
550,000
640,000
649,750
Bay of Plenty
265,000
255,000
260,000
254,000
261,000
263,750
274,250
271,250
291,250
329,163
374,250
Canterbury
250,000
245,000
238,000
250,000
250,000
262,000
290,000
319,500
335,000
348,000
340,000
Gisborne
209,250
182,500
179,250
200,000
184,000
163,125
172,500
188,500
180,000
178,000
220,000
Hawke's Bay
217,500
212,000
212,500
230,000
218,000
224,000
230,000
215,000
234,000
242,625
270,000
Manawatu-Wanganui
165,875
165,000
175,000
175,000
172,000
170,000
174,750
167,500
160,000
170,000
190,000
Marlborough
275,000
269,000
252,000
237,000
230,000
245,000
255,000
247,250
250,000
290,000
315,625
Nelson
265,000
277,750
272,500
265,000
267,875
275,000
292,250
304,500
303,000
360,000
374,250
Northland
245,750
250,000
245,000
250,000
235,000
220,000
235,000
240,000
242,888
265,000
339,750
Otago
200,000
199,000
185,000
200,000
195,000
200,000
212,000
210,000
220,000
240,000
260,000
Southland
135,000
137,500
149,500
146,750
145,000
145,000
145,000
138,000
145,000
153,500
168,000
Taranaki
210,000
205,000
215,000
225,000
205,000
225,000
235,000
235,000
234,750
238,000
259,000
Tasman
290,000
298,500
302,500
295,000
304,000
311,500
327,000
340,000
335,500
378,750
440,000
Waikato
240,000
240,000
252,250
254,000
250,000
255,000
250,000
265,000
265,000
315,000
360,000
Wellington
277,000
285,000
276,000
292,500
282,125
288,750
295,000
300,000
290,000
326,375
382,075
West Coast
150,000
138,125
155,000
150,000
160,000
172,000
180,000
145,000
167,750
145,000
153,000
New Zealand
255,050
250,000
250,000
260,000
260,000
265,000
280,000
295,000
308,000
320,000
332,000
63
A Stocktake of New Zealand’s Housing – February 2018
Table 13: Housing affordability measures – 2007 to 2017 - Years to pay median house price at average wage SOURCE: Statistics New Zealand – Quarterly Employment Survey & Corelogic AUCKLAND
CANTERBURY
NEW ZEALAND
Average weekly Earnings - Employees
Median house price
Years to pay
Median house price
Years to pay
Median house price
Years to pay
Jun-07
737
435,687
11.4
311,000
8.1
345,000
9.0
Sep-07
741
435,000
11.3
315,000
8.2
347,000
9.0
Dec-07
752
445,000
11.4
320,000
8.2
350,000
8.9
Mar-08
776
430,000
10.7
320,000
7.9
343,000
8.5
Jun-08
774
440,500
10.9
305,000
7.6
345,000
8.6
Sep-08
783
426,500
10.5
304,000
7.5
335,200
8.2
Dec-08
792
435,000
10.6
304,000
7.4
340,000
8.3
Mar-09
815
432,000
10.2
299,000
7.1
337,000
8.0
Jun-09
808
445,000
10.6
303,000
7.2
345,000
8.2
Sep-09
810
459,000
10.9
312,500
7.4
353,000
8.4
Dec-09
810
475,000
11.3
325,000
7.7
364,000
8.6
Mar-10
818
475,000
11.2
314,250
7.4
360,000
8.5
Jun-10
818
455,500
10.7
320,000
7.5
360,000
8.5
Sep-10
824
450,000
10.5
325,000
7.6
350,300
8.2
Dec-10
839
468,000
10.7
320,000
7.3
362,000
8.3
Mar-11
851
470,000
10.6
314,000
7.1
357,000
8.1
Jun-11
855
473,000
10.6
320,000
7.2
365,000
8.2
Sep-11
860
461,000
10.3
345,000
7.7
360,000
8.1
Dec-11
864
475,000
10.6
345,000
7.7
370,000
8.2
Mar-12
882
473,500
10.3
336,000
7.3
361,300
7.9
Jun-12
885
499,000
10.8
340,000
7.4
374,000
8.1
Sep-12
888
500,000
10.8
348,000
7.5
372,000
8.1
Dec-12
893
526,000
11.3
359,000
7.7
385,000
8.3
Mar-13
907
536,000
11.4
360,000
7.6
385,000
8.2
Jun-13
903
551,250
11.7
375,500
8.0
394,000
8.4
Sep-13
916
560,000
11.8
375,000
7.9
390,000
8.2
Dec-13
920
605,000
12.6
391,000
8.2
421,000
8.8
Mar-14
937
610,000
12.5
405,000
8.3
417,500
8.6
Jun-14
934
620,000
12.8
415,000
8.5
429,000
8.8
Sep-14
934
620,000
12.8
414,500
8.5
420,000
8.6
Dec-14
944
665,000
13.5
430,000
8.8
450,000
9.2
Mar-15
959
696,900
14.0
420,000
8.4
440,000
8.8
Jun-15
962
740,500
14.8
430,000
8.6
460,000
9.2
Sep-15
963
753,000
15.0
429,250
8.6
462,500
9.2
Dec-15
973
769,600
15.2
440,000
8.7
460,000
9.1
Mar-16
977
775,000
15.3
435,000
8.6
460,000
9.1
Jun-16
979
835,000
16.4
449,000
8.8
486,000
9.5
Sep-16
982
835,000
16.4
432,000
8.5
482,000
9.4
Dec-16
987
850,000
16.6
443,000
8.6
505,000
9.8
Mar-17
999
850,000
16.4
435,000
8.4
500,000
9.6
Jun-17
1,000
825,000
15.9
432,000
8.3
487,500
9.4
64
A Stocktake of New Zealand’s Housing – February 2018
Table 14: Household assets and liabilities – 2006 to 2016 - $millions SOURCE: Reserve –Household Assets & Liabilities data set 2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Non-financial assets
456,682
478,027
437,374
468,016
462,326
469,964
508,848
548,185
596,433
680,123
Equities
428,142
433,887
406,036
429,415
446,690
447,813
473,831
489,614
529,463
573,346
Other financial assets
129,753
136,567
142,943
150,720
169,033
177,453
190,375
201,978
223,461
241,866
Financial assets
557,895
570,454
548,979
580,135
615,723
625,266
664,206
691,592
752,924
815,212
Total assets
1,014,577
1,048,481
986,353
1,048,151
1,078,049
1,095,230
1,173,054
1,239,777
1,349,357
1,495,335
Loans
122,850
135,724
138,773
142,719
145,121
147,764
154,462
163,438
171,597
183,590
Net worth
891,727
912,757
847,580
905,432
932,928
947,466
1,018,592
1,076,339
1,239,777
1,311,745
65
A Stocktake of New Zealand’s Housing – February 2018
Table 15: Estimates of housing stock and population – 1997 to 2017 SOURCE: Statistics New Zealand National Population Estimates and Estimates of Dwellings and Households June years
Occupied dwellings
Change
Resident population
Change
% Housing stock change
% Population change
1997
1,419,900
1998
1,445,300
25,400
3,815,000
33,700
1.8%
0.9%
1999
1,466,300
21,000
3,835,100
20,100
1.5%
0.5%
2000
1,493,000
26,700
3,857,700
22,600
1.8%
0.6%
2001
1,512,800
19,800
3,880,500
22,800
1.3%
0.6%
2002
1,532,000
19,200
3,948,500
68,000
1.3%
1.8%
2003
1,557,400
25,400
4,027,200
78,700
1.7%
2.0%
2004
1,585,300
27,900
4,087,500
60,300
1.8%
1.5%
2005
1,614,600
29,300
4,133,900
46,400
1.8%
1.1%
2006
1,638,400
23,800
4,184,600
50,700
1.5%
1.2%
2007
1,661,100
22,700
4,228,300
43,700
1.4%
1.0%
2008
1,683,500
22,400
4,268,900
40,600
1.3%
1.0%
2009
1,699,600
16,100
4,315,800
46,900
1.0%
1.1%
2010
1,712,200
12,600
4,367,800
52,000
0.7%
1.2%
2011
1,725,900
13,700
4,405,200
37,400
0.8%
0.9%
2012
1,737,800
11,900
4,433,000
27,800
0.7%
0.6%
2013
1,752,600
14,800
4,442,100
9,100
0.9%
0.2%
2014
1,771,200
18,600
4,509,700
67,600
1.1%
1.5%
2015
1,792,800
21,600
4,595,700
86,000
1.2%
1.9%
2016
1,816,600
23,800
4,693,200
97,500
1.3%
2.1%
2017
1,842,900
26,300
4,793,900
1.4%
2.1%
1.3%
1.2%
20 year total
66
3,781,300
A Stocktake of New Zealand’s Housing – February 2018
Table 16: Migration flows – 1997 to 2017 SOURCE: Statistics New Zealand International Travel and Migration data series Australia
All countries
September years
Arrivals
Departures
Net
Arrivals
Departures
Net
1997
12,496
25,586
-13,090
71,868
58,969
12,899
1998
10,951
27,217
-16,266
58,900
62,763
-3,863
1999
9,890
32,552
-22,662
57,279
67,823
-10,544
2000
10,846
36,959
-26,113
62,803
72,331
-9,528
2001
11,489
39,848
-28,359
74,702
76,393
-1,691
2002
13,007
25,852
-12,845
95,417
58,307
37,110
2003
14,083
23,393
-9,310
95,540
55,103
40,437
2004
14,370
27,979
-13,609
81,823
64,066
17,757
2005
13,607
34,304
-20,697
78,939
72,534
6,405
2006
13,268
33,866
-20,598
81,641
68,441
13,200
2007
13,579
39,773
-26,194
83,004
74,695
8,309
2008
13,237
47,166
-33,929
86,657
82,254
4,403
2009
14,260
37,362
-23,102
87,209
70,166
17,043
2010
15,726
33,814
-18,088
82,412
68,498
13,914
2011
14,678
48,829
-34,151
84,801
84,028
773
2012
14,209
53,729
-39,520
83,629
86,909
-3,280
2013
18,108
43,411
-25,303
91,187
76,013
15,174
2014
22,596
28,582
-5,986
105,468
60,054
45,414
2015
24,683
24,903
-220
118,882
57,648
61,234
2016
25,785
23,820
1,965
125,642
55,688
69,954
2017
25,003
25,069
-66
131,598
60,612
70,986
67
A Stocktake of New Zealand’s Housing – February 2018
Table 17: Consents for new dwellings for Auckland and New Zealand – 1997 to 2017 SOURCE: Statistics New Zealand Building Consents series and Sub-national Population Estimates from Infos database New Zealand new dwellings consents
Auckland new dwelling consents
Auckland's share of new building consents
Auckland's share of population growth
1997
22,649
8,451
37.3%
62.7%
1998
24,256
9,259
38.2%
66.2%
1999
22,608
9,209
40.7%
78.6%
2000
24,244
9,965
41.1%
73.9%
2001
19,345
7,407
38.3%
73.7%
2002
22,533
9,374
41.6%
55.1%
2003
29,074
12,277
42.2%
53.1%
2004
33,251
12,937
38.9%
47.1%
2005
27,444
9,435
34.4%
49.4%
2006
25,563
7,250
28.4%
47.5%
2007
26,538
6,781
25.6%
44.4%
2008
23,261
5,769
24.8%
41.9%
2009
14,175
3,212
22.7%
37.9%
2010
16,167
3,656
22.6%
37.2%
2011
13,539
3,394
25.1%
60.1%
2012
15,414
4,197
27.2%
70.1%
2013
18,783
5,343
28.4%
49.1%
2014
23,316
6,873
29.5%
49.9%
2015
25,154
8,300
33.0%
50.0%
2016
29,097
9,651
33.2%
45.7%
30,453
10,364
34.0%
42.4%
486,864
163,104
33.5%
51.0%
June years
2017 TOTALS
68
A Stocktake of New Zealand’s Housing – February 2018
Table 18: Estimates of Auckland’s housing shortfall – 2007 to 2017 SOURCE: Statistics New Zealand’s Sub-National Population Estimates and Building Consents series. June years
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
1,390,400
1,405,500
1,421,700
1,439,600
1,459,600
1,476,500
1,493,200
1,526,900
1,569,900
1,614,400
1,657,200
15,100
16,200
17,900
20,000
16,900
16,700
33,700
43,000
44,500
42,800
Dwellings required for population growth
5,033
5,400
5,967
6,667
5,633
5,567
11,233
14,333
14,833
14,267
Consents for new dwellings
5,769
3,212
3,656
3,394
4,197
5,343
6,873
8,300
9,651
10,364
736
-2,188
-2,311
-3,273
-1,436
-224
-4,360
-6,033
-5,182
-3,903
Resident population Annual population growth
Surplus/deficit
69
A Stocktake of New Zealand’s Housing – February 2018
Table 19: Residential construction industry costs and prices – 1997 to 2017 SOURCE: Statistics New Zealand Producer Price Indices, Consumer Price Indices and Building Consents datasets
PPI Input
PPI Output
CPI
Average construction cost for house $s
1997
1,000
1,000
1,000
140,000
181
775
1998
1,004
1,007
1,017
142,600
177
806
September years
Average floor area m2
Average PSM cost $s
1999
996
999
1,012
148,800
180
829
2000
1,017
1,016
1,043
153,900
186
827
2001
1,042
1,036
1,068
162,500
193
841
2002
1,068
1,060
1,096
177,100
204
868
2003
1,084
1,112
1,112
189,800
209
909
2004
1,130
1,211
1,140
202,000
208
971
2005
1,176
1,274
1,179
226,500
217
1,044
2006
1,230
1,342
1,220
242,300
218
1,113
2007
1,310
1,402
1,242
259,100
215
1,208
2008
1,349
1,464
1,305
277,200
215
1,289
2009
1,356
1,447
1,327
299,700
217
1,382
2010
1,391
1,457
1,346
297,500
216
1,377
2011
1,425
1,477
1,408
305,800
215
1,421
2012
1,458
1,508
1,419
309,500
212
1,457
2013
1,480
1,560
1,439
328,600
215
1,532
2014
1,508
1,629
1,453
348,500
214
1,627
2015
1,546
1,705
1,459
366,800
211
1,736
2016
1,571
1,792
1,465
374,900
208
1,803
2017
1,616
1,876
1,493
395,600
207
1,907
70
A Stocktake of New Zealand’s Housing – February 2018
Table 20: Dwelling construction costs – 1997 to 2017 SOURCE: Statistics New Zealand – Building consents data series and Consumer Price Index Number of consents for new dwellings
Total value $million
Total area m2
Average floor area m2
Value psm $s
CPI June
Value in 2017 $ values
1997
22,649
2,943
3,811,759
168
772
821
1,152
1998
24,256
3,142
3,842,254
158
818
835
1,201
1999
22,608
3,039
3,627,858
160
838
832
1,234
2000
24,244
3,392
4,045,680
167
838
849
1,211
2001
19,345
2,848
3,389,215
175
840
876
1,176
2002
22,533
3,670
4,165,784
185
881
900
1,200
2003
29,074
4,781
5,125,629
176
933
913
1,252
2004
33,251
5,960
5,984,823
180
996
935
1,306
2005
27,444
5,643
5,120,121
187
1,102
962
1,405
2006
25,563
5,661
4,898,344
192
1,156
1,000
1,417
2007
26,538
6,413
5,130,935
193
1,250
1,020
1,502
2008
23,261
5,980
4,569,262
196
1,309
1,061
1,512
2009
14,175
3,847
2,781,266
196
1,383
1,081
1,569
2010
16,167
4,484
3,237,207
200
1,385
1,099
1,545
2011
13,539
3,806
2,657,688
196
1,432
1,157
1,517
2012
15,414
4,340
2,960,734
192
1,466
1,168
1,539
2013
18,783
5,710
3,703,114
197
1,542
1,176
1,607
2014
23,316
7,281
4,445,923
191
1,638
1,195
1,680
2015
25,154
8,082
4,596,228
183
1,758
1,200
1,797
2016
29,097
9,901
5,267,976
181
1,879
1,205
1,912
2017
30,453
10,894
5,429,877
178
2,006
1,226
2,006
June years
71
A Stocktake of New Zealand’s Housing – February 2018
Table 21: Local government financial statistics – 2010 to 2017 SOURCE: Statistics New Zealand – Local Government Financial Statistics and Auckland Council’s Annual Reports June years
2010
2011
2012
2013
2014
2015
2016
Current borrowings
1,641
1,892
1,858
2,477
2,043
1,569
2,126
Non-current borrowings
5,384
5,702
7,067
7,914
9,188
11,315
11,757
Total borrowings
7,025
7,594
8,925
10,391
11,232
12,884
13,882
Rates revenue
4,144
4,350
4,512
4,603
4,764
5,003
5,317
2017
ALL COUNCILS - $millions
Finance costs Finances costs as % of rates
378
506
493
545
599
687
693
9.1%
11.6%
10.9%
11.8%
12.6%
13.7%
13.0%
AUCKLAND COUNCIL - $millions Current borrowings
950
663
1,290
1,171
1,006
1,447
1,125
Non-current borrowings
3,081
4,369
4,594
5,170
6,328
6,164
7,175
Total borrowings
4,031
5,032
5,884
6,341
7,334
7,611
8,300
927
1,373
1,337
1,395
1,458
1,564
1,641
Rates revenue Finance costs Finances costs as % of rates
72
221
300
345
372
422
417
471
23.8%
21.8%
25.8%
26.7%
28.9%
26.7%
28.7%
A Stocktake of New Zealand’s Housing – February 2018
Table 22: Estimates of state and social housing units by region – September 2017 SOURCES: Housing New Zealand Annual Reports and Community Housing Aotearoa HNZC
Councils
CHO's
Total
Northland
2,175
370
100
2,645
Auckland
27,791
0
5,591
33,382
Waikato
4,547
265
797
5,609
Bay of Plenty
1,567
547
1,492
3,606
Gisborne
1,290
120
54
1,464
Hawkes Bay
2,808
723
80
3,611
Taranaki
1,152
218
315
1,685
Manawatu-Wanganui
2,545
830
88
3,463
Wellington
8,615
2,583
783
11,981
Marlborough
414
101
14
529
Nelson-Tasman
784
314
136
1,234
West Coast
315
174
2,852
3,341
Canterbury
6,894
544
8
7,446
Otago
1,611
696
302
2,609
409
221
39
669
62,917
7,706
12,651
83,274
4,787
63,299
7,864
19,975
Southland IRR Market or vacant
73
58,512 4,405
7,706
A Stocktake of New Zealand’s Housing – February 2018
Table 23: Changes in Housing New Zealand’s stock by region – 2012 and 2017 SOURCE: Housing New Zealand’s Annual Reports June 2012 Region
Owned
June 2017
Leased
Total
Owned
Leased
Total
Change 2012-17
Northland
2,252
86
2,338
2,095
80
2,175
-7.0%
Auckland
28,857
2,097
30,954
26,180
1,611
27,791
-10.2%
Waikato
4,356
395
4,751
4,242
305
4,547
-4.3%
Bay of Plenty
2,745
127
2,872
1,482
85
1,567
-45.4%
Gisborne
1,330
0
1,330
1,290
0
1,290
-3.0%
Hawkes Bay
3,129
65
3,194
2,749
59
2,808
-12.1%
Taranaki
1,272
5
1,277
1,150
2
1,152
-9.8%
Manawatu-Wanganui
2,976
0
2,976
2,545
0
2,545
-14.5%
Wellington
9,007
122
9,129
8,534
81
8,615
-5.6%
Marlborough
431
10
441
405
9
414
-6.1%
Nelson-Tasman
778
24
802
763
21
784
-2.2%
West Coast
341
9
350
311
4
315
-10.0%
Canterbury
6,438
349
6,787
6,559
335
6,894
1.6%
Otago
1,721
24
1,745
1,587
24
1,611
-7.7%
496
0
496
409
0
409
-17.5%
66,129
3,313
69,442
60,301
2,616
62,917
-9.4%
Auckland
28,857
2,097
30,954
26,180
1,611
27,791
-10.2%
Hamilton
2,707
333
3,040
2,802
285
3,087
1.5%
Tauranga
1,285
110
1,395
157
75
232
-83.4%
Wellington
8,766
120
8,886
8,309
81
8,390
-5.6%
Christchurch
5,740
346
6,086
5,888
332
6,220
2.2%
Dunedin
1,505
24
1,529
1,411
24
1,435
-6.1%
Southland Total Main cities
74
A Stocktake of New Zealand’s Housing – February 2018
Table 24: Social Housing Register by priority – 2014 to 2017 SOURCE: Ministry of Social Development Jun-14
Sep-14
Dec-14
Mar-15
Jun-15
Sep-15
Dec-15
Mar-16
Jun-16
Sep-16
Dec-16
Mar-17
Jun-17
Sep-17
Priority A
2,596
2,156
1,828
1,833
1,641
2,010
2,132
2,188
2,482
3,011
3,189
3,422
3,690
4,054
Priority B
2,034
2,033
1,830
1,729
1,711
1,389
1,344
1,361
1,395
1,591
1,582
1,443
1,663
1,790
Total
4,630
4,189
3,658
3,562
3,352
3,399
3,476
3,549
3,877
4,602
4,771
4,865
5,353
5,844
Sep-15
Dec-15
Mar-16
Jun-16
Sep-16
Dec-16
Mar-17
Jun-17
Sep-17
1 bedroom
1,481
1,540
1,587
1,734
2,118
2,207
2,239
2,408
2,647
2 bedrooms
1,098
1,144
1,192
1,297
1,538
1,609
1,657
1,856
2,014
3 bedrooms
526
498
482
547
592
568
574
669
753
4 bedrooms
208
216
209
223
269
292
310
305
318
Table 25 Social Housing Register by type of property – 2015 to 2017 SOURCE: Ministry of Social Development
5 or more bedrooms Total
86
78
79
76
85
94
85
114
112
3,399
3,476
3,549
3,877
4,602
4,771
4,865
5,353
5,844
Sep-15
Dec-15
Mar-16
Jun-16
Sep-16
Dec-16
Mar-17
Jun-17
Sep-17
922
892
907
963
1,126
1,190
1,241
1,364
1,416
Table 26: Social Housing Register by ethnicity of applicants – 2015 to 2017 SOURCE: Ministry of Social Development
NZ European Māori
1,368
1,445
1,548
1,648
2,009
2,156
2,190
2,357
2,623
Pacific peoples
524
532
499
538
621
609
592
692
787
Other
553
576
558
678
780
759
773
836
905
32
31
37
50
66
57
69
104
113
3,399
3,476
3,549
3,877
4,602
4,771
4,865
5,353
5,844
Unknown1 Total
75
A Stocktake of New Zealand’s Housing – February 2018
Table 27: Social Housing Register by Region – 2014 to 2017 SOURCE: Ministry of Social Development Sep-14
Northland
Sep-15
Sep-16
Sep-17
138
124
153
182
2,365
1,633
1,907
2,464
Waikato
292
207
259
372
Bay of Plenty
193
190
341
346
Auckland
Gisborne
31
62
97
109
140
153
192
376
Taranaki
42
45
41
76
Manawatu-Wanganui
54
63
192
312
Hawkes Bay
Wellington
272
235
507
703
Marlborough
29
13
53
67
Nelson-Tasman
28
30
64
114
West Coast
9
9
15
17
Canterbury
526
527
553
539
Otago
63
58
56
97
Southland
17
24
18
43
4,189
3,393
4,602
5,844
New Zealand
NOTE: Regional figures have been rounded from TLA data so do not sum exactly to totals
76
A Stocktake of New Zealand’s Housing – February 2018
Table 28: Initial assessments of housing need – 2015 to 2017 SOURCE: Ministry of Social Development Dec-15
Northland
Mar-16
Jun-16
Sep-16
Dec-16
Mar-17
260
215
249
318
238
259
1,521
1,320
1,688
2,424
2,015
1,960
Waikato
374
389
547
554
567
524
Bay of Plenty
305
347
381
439
403
377
93
82
102
120
98
168
241
265
230
262
247
339
Auckland
Gisborne Hawkes Bay Taranaki
75
74
98
113
91
131
Manawatu-Wanganui
224
208
269
337
299
409
Wellington
601
544
619
860
658
717
Marlborough
62
66
79
73
82
85
Nelson-Tasman
97
75
81
112
130
126
West Coast
27
28
18
28
23
32
Canterbury
526
577
772
787
701
725
Otago
135
114
110
160
171
195
44
35
44
54
52
57
Southland Unknown Total
56
101
65
136
57
94
4,643
4,445
5,353
6,771
5,848
6,209
NOTE: Regional figures have been rounded from TLA data so do not sum exactly to total
77
A Stocktake of New Zealand’s Housing – February 2018
Table 29: Households placed on the social housing register by region – 2015 to 2017 SOURCE: Ministry of Social Development
Dec-15
Mar-16
Jun-16
Sep-16
Dec-16
Mar-17
Northland
110
122
96
112
83
87
Auckland
483
484
697
1,051
1,044
964
Waikato
61
85
112
124
132
179
Bay of Plenty
95
109
146
162
129
142
Gisborne
34
41
57
56
52
87
Hawkes Bay
79
128
116
169
154
184
Taranaki
27
30
46
62
39
59
Manawatu-Wanganui
109
120
176
203
191
256
Wellington
252
263
303
367
366
330
Marlborough
20
19
25
19
36
32
Nelson-Tasman
18
28
24
34
46
41
West Coast
9
11
9
12
6
11
Canterbury
252
274
377
348
323
351
Otago
46
47
47
58
60
84
Southland
13
14
21
24
18
20
Unknown Total
330
55
124
53
28
35
1,921
1,822
2,371
2,843
2,704
2,873
NOTE: Regional figures have been rounded from TLA data so do not sum exactly to total
78
A Stocktake of New Zealand’s Housing – February 2018
Table 30: Analysis of Ministry of Social Development’s social housing purchasing intentions – December 2016 SOURCE: Ministry of Social Development Auckland
Rest of NZ
New Zealand
Housing NZ - additions
2,104
504
2,608
Housing NZ - disposals
1,252
HOUSING NEW ZEALAND
Housing NZ external transfers Net change for Housing New Zealand
852
817
2,069
1,124
1,124
-1,437
-585
1,124
1,124
NGO & OTHER NON-STATE PROVIDERS Transferred from Housing NZ Transferred from TLA
420
903
1,323
Redirected from existing CHA stock
197
284
481
Leased from private sector
57
57
New builds
183
43
226
Additional IRRS stock excl Housing NZ
857
2,354
3,211
Additional IRRS stock incl Housing NZ
1,709
917
2,626
191
973
1,164
1,900
1,890
3,790
Additional stock still to be identified Total additional IRRS by 2020
79
A Stocktake of New Zealand’s Housing – February 2018
Table 31: Key financial results of Housing New Zealand – 2008 to 2017 SOURCE: Housing New Zealand’s Annual Reports June years
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
342
355
337
338
62
51
66
51
REVENUE Rents from IRRS tenants Rents from market tenants Rental income from tenants
362
376
384
388
398
400
404
406
403
389
Income related rent subsidies
476
507
533
564
596
633
663
704
739
758
79
69
71
319
88
89
72
95
142
171
917
952
988
1,271
1,082
1,122
1,139
1,205
1,284
1,318
Repairs & maintenance
187
217
216
179
174
190
220
222
289
315
Depreciation
179
178
172
181
180
187
201
215
231
246
98
109
114
120
101
102
104
108
115
113
Third party leases
0
0
0
62
64
66
66
65
63
61
Interest expenses
126
124
113
112
109
103
96
96
93
87
Other expenses
246
280
269
272
233
296
237
243
307
375
Total expenses
836
908
884
926
861
944
924
949
1,098
1,197
Operating surplus before tax
81
44
104
159
221
178
200
225
178
81
Income tax expense
35
12
779
52
63
58
59
62
44
16
Net surplus after tax
46
32
-675
107
158
120
141
163
134
65
15,493
14,911
15,443
15,539
15,886
17,244
19,597
21,816
23,400
25,907
3,197
3,141
3,915
3,916
3,905
3,918
4,036
4,194
4,233
4,309
12,296
11,770
11,528
11,623
11,981
13,326
15,561
17,622
19,167
21,598
3,587
3,656
3,761
3,781
3,785
3,788
3,788
3,792
3,562
3,557
-77
5
-771
-513
-369
-171
-63
67
287
536
Other revenue Total operating revenue EXPENSES
Rates
Total assets Total liabilities Net assets Equity attributable to the Crown Retained earnings Revaluation reserve Net equity
8,762
8,162
0
0
8,691
9,777
11,866
13,848
15,435
17,577
12,296
11,770
11,528
11,623
11,981
13,326
15,561
17,622
19,167
21,598
Dividend paid to Crown
13
2
132
71
68
77
90
108
30
0
Capital contribution from Crown
99
69
105
20
4
3
0
4
2
-5
Net contribution by Crown
86
67
-27
-51
-64
-74
-90
-104
-28
-5
80
A Stocktake of New Zealand’s Housing – February 2018
Table 32: Expenditure on housing subsidies – 2008 to 2018 SOURCE: Treasury: Budget Economic and Fiscal Updates $millions June years
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
Accommodation Supplement
891
989
1,154
1,197
1,195
1,177
1,146
1,129
1,164
1,129
1,219
Income Related Rents
474
512
522
553
580
611
660
703
755
848
900
3
8
49
2
11
16
1,752
1,786
1,804
Emergency Housing KiwiSaver Deposit Subsidy Homestart grants Total
1,365
1,501
1,676
26
37
70
75
102
1,832
1,869
1,992
2,060
2,269
Table 33: Numbers of payments made for Accommodation Supplement and the main working age benefits – 2012 to 2017 SOURCE: Ministry of Social Development – Benefit Factsheets At 30 September
2012
2013
2014
2015
2016
2017
Number of AS payments made
306,238
297,179
292,546
293,570
291,352
285,485
Number of working age benefits paid
320,942
304,394
294,321
287,167
283,875
277,220
81
A Stocktake of New Zealand’s Housing – February 2018
Table 34: Regional estimates of the rental housing stock and Accommodation Supplement payments – June 2017 SOURCE: Ministry of Social Development – supplied on a customised basis Estimate of rental housing stock
Estimate of number of tenants receiving AS
Estimate of total number of AS payments made
AS tenants payments as proportion of rental stock
Northland
27,400
9,290
14,762
34%
Auckland
216,700
61,989
90,745
29%
Waikato
74,900
18,867
28,222
25%
Bay of Plenty
45,600
15,570
24,503
34%
7,800
2,362
3,834
30%
Hawkes Bay
23,600
7,945
12,796
34%
Taranaki
16,600
4,624
7,002
28%
Manawatu-Wanganui
37,100
11,756
18,523
32%
Wellington
73,200
17,607
26,569
24%
6,100
1,651
2,316
27%
14,100
4,606
6,512
33%
Gisborne
Marlborough Nelson-Tasman West Coast
5,700
1,343
2,149
24%
Canterbury
86,000
17,596
25,775
20%
Otago
33,500
6,905
10,022
21%
Southland
14,000
3,169
4,875
23%
3,976
6,544
189,256
285,149
Other Total
82
682,300
28%
A Stocktake of New Zealand’s Housing – February 2018
Table 35: Recipients receiving the maximum Accommodation Supplement Payment by MSD region – June 2017 SOURCE: Ministry of Social Development – supplied on a customised basis Tenants receiving AS
% receiving maximum
Boarded receiving AS
% receiving maximum
Owner receiving AS
% receiving maximum
All recipients of AS
% receiving maximum
Northland
9,249
71%
3,819
14%
1,543
56%
14,611
54%
Auckland
60,984
50%
18,447
1%
9,501
27%
89,721
39%
Waikato
16,748
70%
5,988
12%
2,276
56%
25,012
55%
MSD Regions
Taranaki Bay of Plenty East Coast
9,300
66%
3,572
12%
1,668
53%
14,540
51%
16,807
57%
6,464
8%
2,754
45%
26,025
43%
9,568
66%
4,210
9%
1,738
53%
15,679
48%
Central
12,570
66%
4,349
12%
2,543
54%
19,462
52%
Wellington
13,168
54%
4,663
6%
2,226
42%
20,057
43%
7,656
58%
1,574
10%
1,784
46%
11,014
49%
Canterbury
16,110
66%
4,519
13%
2,993
55%
23,622
54%
Southern
12,068
61%
3,461
15%
2,453
46%
17,982
51%
4,122
38%
2,273
4%
320
23%
6,830
27%
188,350
59%
63,339
8%
31,799
43%
284,555
46%
Nelson
Other Total
83
A Stocktake of New Zealand’s Housing – February 2018
Table 36: Numbers of people receiving both New Zealand Superannuation and the Accommodation Supplement – 2010 to 2017 SOURCE: Customised data provided by Ministry of Social Development Jun-10
Jun-11
Jun-12
Jun-13
Jun-14
Jun-15
Jun-16
Jun-17
People receiving NZ Superannuation & AS and renting
18,445
19,555
21,118
22,667
23,816
25,346
27,035
28,434
All people receiving both NZ Superannuation & AS
26,458
27,711
29,689
31,686
33,388
35,488
37,527
39,463
550,520
571,239
598,933
626,313
653,247
677,935
704,607
729,445
4.8%
4.9%
5.0%
5.1%
5.1%
5.2%
5.3%
5.4%
Total number of people receiving NZ Superannuation % of people receiving NZ Superannuation also receiving AS
Table 37: Applications and approvals for Homestart grants SOURCE: Housing New Zealand Financial Products Reports Year ending 30 June
2015
2016
2017
15,636
26,763
31,731
Approved
7,190
15,374
16,712
Pre-approved
2,476
12,943
17,472
In process
2,016
363
315
Declined
2,820
7,524
8,184
Total Applications
84
A Stocktake of New Zealand’s Housing – February 2018
Table 38: Transitional housing places for selected regions – 2016 to 2017 SOURCE: Ministry of Social Development Sep-16
Dec-16
Mar-17
Jun-17
Sep-17
Target
Auckland
210
252
265
470
656
915
Hamilton
15
15
22
44
87
74
Tauranga
3
3
3
25
44
58
46
46
46
54
68
91
125
125
129
165
212
259
12
12
12
13
21
25
Rest of New Zealand
232
232
259
352
575
733
Total
643
685
736
1,233
1,663
2,155
Wellington Christchurch Dunedin
Table 39: Provision of emergency housing assistance by Ministry of Social Development – 2016 to 2017 SOURCE: Ministry of Social Development Sep-16
Emergency Housing Special Needs Grants Priority A applicants in insecure housing Priority A applicants in transitional housing
85
1,139
Dec-16
Mar-17
Jun-17
Sep-17
2,510
3,616
4,133
2,377
1,283
1,642
1,855
2,168
116
192
448